- FTSE 100 down 68 points at 10,126
- Global stocks continue to be hit by geopolitical worries
- Gold hits new high above $4720/oz
5.15pm: Stocks retreat
The FTSE 100 finished Tuesday’s session 68 points lower at 10,126 as investors weighed up US tariff threats and crashing Japanese government bonds.
“Markets have slipped back into a risk-off mood after renewed political shocks from President Trump and rapidly rising Japanese bond yields unsettled investors, erasing early-January stock gains, pushing bitcoin sharply lower and leaving gold as the main haven,” IG chief technical analyst Axel Rudolph said.
“Following the collapse at a 20-year Japanese government bond auction, the country's 10-year yields rallied to their highest level since the 1990s while 30- and 40-year yields hit record highs, driving global bond yields higher and worrying investors about a possibly severe stock market setback.”
4.10pm: Losses pared
The FTSE 100 and FTE 250 have both pared their losses to below 1%.
Blue chips are down 0.8% and mid-caps are 0.5% lower.
Earlier, both indices were heading for their steepest single-day drops since mid-November, analysts said.
Biggest blue-chip fallers are paper and packaging maker Mondi, down 3.8%, followed by AstraZeneca, Land Securities, British American Tobacco and Beazley.
The leaderboard is topped by Informa, Haleon, Endeavour Mining, Rentokil Initial and Melrose Industries.
3.47pm: US says America first, but Reeves points out importance of allies
US Trade Sec Howard Lutnick has been speaking in Davos.
He echoes a point prominently made by Vice President JD Vance that "globalisation has failed the West and the USA". It's
Lutnick says globalisation is "what the WEF has stood for, which is, export, offshore, find the cheapest labour in the world."
He says as an example that Europe made a mistake by committing to net-zero policies that rely on technology and commodities from China.
He argues that the America First movement is all about not being dependent on another country for anything that is important to your sovereignty.
“When America shines, the world is brighter.”
UK finance minister Rachel Reeves is also on the panel and she agrees that the world would be poorer and scarier without the US.
But she says "the idea of putting your own country first and considering your own security and resilience" is compelling and points to her idea of "securonomics", but she says unlike the US, "we can't do everything on our own".
She tells Lutnick, "you've got a lot of allies around the world...we do need to think about where the threats are, and who our friends are". She says the UK is probably the US’s closest ally.
She points out 90% of the US's rare earth minerals currently come from China, and it won't be able to get by on its own and will need the support of allies.
US trade secretary Howard Lutnick really not mincing his words here at Davos: "We are here to make a v clear point: globalisation has failed the West and the USA. It's a failed policy. It's what the WEF has stood for, which is, export, offshore, find the cheapest labour in the world."
— Heather Stewart (@guardianheather.bsky.social) January 20, 2026 at 3:23 PM
She tells Lutnick, "you've got a lot of allies around the world...we do need to think about where the threats are, and who our friends are..." Points out 90% of the US's critical minerals currently come from China, and it won't be able to wean itself off those without the support of allies.
— Heather Stewart (@guardianheather.bsky.social) January 20, 2026 at 3:28 PM
3.12pm: Citi downgrades Europe over Greenland tariffs
Some interesting stuff from Citi today, calculating the potential impact if negotiations fail to avert Trump's Greenland tariffs, as they expect the UK will dodge most of the fallout.
Citi sees negligible impact on British GDP, and even suggests the move could help reinforce the current disinflation trend.
Not so rosy for Europe, though, as Citi has downgraded continental European equities to 'neutral', ending a year-long stretch of relative optimism.
The tariffs would raise medium-term inflation risks and dim the earnings outlook in key export-heavy sectors, on the basis that no negotation made and Trump does not back down.
In Citi’s words, the Greenland tariffs mark a step change from last year’s Liberation Day measures, upping the risk of EU retaliation and potentially accelerating joint defence spending, and potentially even new rounds of EU-level borrowing.
2.43pm: Wall Street opens sharply lower
US stocks have returned from the long weekend into a vortex of selling.
Tech stocks on the Nasdaq are in the eye of the storm, with the composite index down 1.8% as the likes of Nvidia fall 3.2%, Google, Amazon and Tesla and all drop more than 2%, Microsoft and Apple more than 1%.
The S&P 500 has opened 1.4% lower and the Dow Jones has dropped 1.3%.
Only two companies on the Dow are not in red, Walmart and Chevron.
1.26pm: CEO's low on confidence about growth
Even before the events of the last few days, corporate CEO confidence in the growth outlook has sunk to a five-year low, according to a PwC survey.
Only 30% of CEOs are confident about revenue growth in 2026, with most citing struggle to turn AI investment into tangible returns.
A damning verdict on AI, with just 12% of CEOs saying it has delivered both cost and revenue benefits.
There are rising concerns about tariffs when the survey was carried out among 4,454 CEOs in 95 countries late last year, with cyber risk another big worry.
Only half of CEOs plan to make international investments this year, with the US remains the top destination for global investment (35% of putting it in their top three), with the UK, Germany and China (13%, 13% and 11%) also popular, but the hot new country of interest is India, with interest doubling year-on-year.
12.59pm: Wall Street set to open with heavy selling
Wall Street futures have pared losses too, with the opening bell around an hour and a half away.
Nasdaq futures are still down over 1.6%, which would still be a hefty drop, while S&P 500 and Dow Jones futures are down 1.4% and 1.3%.
It will be the first trading in US stocks since President Trump’s threat to impose tariffs on eight European nations should negotiations over Greenland fail.
The US President will be attending events at the World Economic Forum in Davos on Wednesday, giving a speech and talking to fellow world leaders on the sidelines.
European leaders are pushing back against Washington’s stance and reportedly discussing countermeasures, including a potential first try of the EU’s Anti-Coercion Instrument, aka 'bazooka'.
The US dollar index is down 0.9%, further retreating from Friday's six-week high, while Treasury yields are up, sparked by Japan (see below).
12.23pm: FTSE pares losses slightly
The FTSE has seen the worst of its intraday losses trimmed as we move into the afternoon.
However, all but two of the 20 largest companies on the index are in the red. Those two are Unilever and NatWest.
Top riser on the blue-chip index today is Informa, which put out a trading update today, where it said full-year revenue, earnings and cash flows should come in slightly ahead of consensus forecasts.
Informa also announced the combination of its B2B Live Events business in the UAE and wider IMEA region, with Dubai World Trade Centre's similar business, creating a new operating business that is called inD. This will be the group's largest partnership business globally, and will operate more than 40 major B2B Brands.
Analysts at UBS said the update was a "small positive" and that 2025 "looks solid" with the key headline being free cash flow generation is slightly ahead of expectations.
On the deal with DWTC, they "expect some optimism around that".
11.50am: Barclays tipped as top bank
Ahead of the bank reporting season, JP Morgan has thrown down the gauntlet for UK lenders, identifying Barclays and NatWest as its highest‑conviction picks amid a broad target price refresh and evolving profit expectations.
Strategists restated their 'overweight' stance, while maintaining a 'neutral' view on Lloyds.
They said forthcoming updates to medium‑term targets will be critical to re‑rate the names, particularly as investors digest return on tangible equity, net interest income trends and capital returns.
Recent US bank updates provided positive read‑throughs, particularly in investment banking and cards, which are seen as especially supportive for Barclays.
11am: Natural gas prices back up
Bad news for those worrying about inflation - natural gas prices have surged in the past few weeks, and after a dip yesterday are back up again today.
UK wholesale nat gas prices have risen to above 94p per therm, up from 74p at the start of the year.
Last week, analysts said pressures threatened to lift energy bills, with prices at a six-month high.
Cold weather in Europe, combined with low gas storage levels and slower deliveries of liquified natural gas, have resulted in prices spiking.
10.22am: Fund managers bullish but wary of geopolitics
January’s Bank of America Fund Manager Survey is the most bullish since 2021, with expectations for global growth having jumped, and managers' cash levels having fallen to a record low of 3.2%.
The BofA 'Bull & Bear' indicator has climbed to a "hyper-bull" reading, with the low levels of cash also combined with a net 48% of respondents saying they have no protection against a sharp fall in equity prices.
Investors are the most overweight on equities since late 2024, with a net overweight positioning at 48%, with a net overweight on commodities of 26% also the highest level since 2022.
The positioning on bonds is the most underweight since September 2022.
A net 38% of respondents expect a stronger global economy, the highest reading since mid 2021, while expectations for a recession have fallen to just 9%, the lowest since early 2022.
The biggest tail risks cited are geopolitical conflict at 28%, an AI bubble at 27%, and a disorderly rise in bond yields at 19%.
The main theme at #Davos26 has also reached fund managers. In Bank of America’s survey, geopolitical conflict is seen as the biggest tail risk by fund managers. pic.twitter.com/xZCBFcaFwb
— Holger Zschaepitz (@Schuldensuehner) January 20, 2026
Market looks ripe for a correction. January’s Fund Manager Survey is most bullish since Jul2021: expectations for global growth have jumped, cash levels have fallen to a record low of 3.2%, and protection against equity sell-off is at its lowest since Jan2018. BofA’s Bull & Bear… pic.twitter.com/a9T5lLpJzn
— Holger Zschaepitz (@Schuldensuehner) January 20, 2026
9.27am: Stocks plunging, gold rising
European stocks are continuing to plunge, while safe havens such as gold and silver are climbing to new highs.
The FTSE 100 has tumbled 126 points or 1.2% to 10,069, while the German DAX is down 1.3%, France's CAC 40 is down 1.1% and Spain's IBEX 35 is down 1.5%.
US stocks are set to plummet later too. Nasdaq futures are down 2%, with the Dow Jones expected to drop 1.4% and the S&P 500 1.7%.
"Stocks and bonds are a sea of red on Tuesday as tensions around Greenland remain high," says Kathleen Brooks at XTB.
She calls the UK labour market data "a brief distraction from geopolitical concerns".
The pound is up 0.45% against the US dollar, while the euro is up 0.7% versus the dollar.
"What happens next for financial markets will ultimately depend on President Trump’s actions in the coming days," says Brooks, with Greenland the main focus for investors this week.
Latest develoments include the US President reposting a mocked-up picture of himself holding a US flag with a caption of "Greenland - US territory est 2026" but also said that he will hold a meeting about Greenland at Davos this week after a conversation with the Nato secretary general Mark Rutte.
Trump has also slammed the UK agreement to hand over sovereignty of the Chagos Islands to Mauritius, including the island of Diego Garcia, the site of a US military base, as "an act of GREAT STUPIDITY, and is another in a very long line of National Security reasons why Greenland has to be acquired".
Brooks also flags a rise in global bond yields, sparked by a sell-off in Japanese bonds, where the 30-year yield climbed more than 25bps, "an unprecedented move", triggered by the snap election that will be held on 8 January.
The prospect of a win for PM Sanae Takaichi, who has promised an expansionary fiscal policy despit Japan's debt to GDP ratio is already nearly 250%, "is causing a major upset in the Japanese bond market", says Brooks.
"Japan can’t afford tax cuts right now, and unless the BOJ intervenes it is hard to see how yields will normalize. If Takaichi is not careful in this election campaign, the similarities between her and Liz Truss could haunt her."
8.49am: Ibstock slips on update
Ibstock PLC (LSE:IBST) is the biggest faller on the FTSE 350, after the brickmaker said it expects revenue for FY25 to come in around £372 million, 2% up on 2024, with EBITDA to be circa £71 million, down from £79 million in 2024.
Brick volumes improved but soft pricing and mix impacted revenue growth, with trading conditions getting tougher through the second half, leaving the group with higher stocks at the end of the year.
Analyst Clyde Lewis at house broker Peel Hunt said revenues look 3% below his estimate, with EBITDA in line with consensus.
The outlook for volumes is subdued in the first half before a modest recovery is expected in the second, with pricing expected to offset cost inflation.
Production volumes are to be managed lower, which Lewis says gives the group a plant overhead recovery issue and lead to him cutting his 2026 EBITDA forecast by £12 million and 2027 by circa £10 million, resulting in his PBT estimates dropping from £39 million to £29 million for FY26 and from £51 million to £42 million for FY27.
8.31am: Jobs data 'points to April BoE cut'
Some thoughts on the jobs data.
Chris Beauchamp, chief market analyst at IG: "Today's employment figures from the UK were broadly in line with expectations, but with the unemployment rate holding at 5.1% the BoE will be relieved to see slowing wage growth, helping the case for a rate hike, if only modestly. With the unemployment rate holding steady there is hope that the economy continues on a shallow upward trajectory, though it is too much to hope for spectacular improvement given the long-term problems of low productivity and high energy costs."
Sanjay Raja, chief UK economist at Deutsche Bank, said: "The labour market remains fragile. Hiring demand is weak. Pay growth is slowing. But there are some green shoots in the labour market. We will need to see more evidence of this, however, to be convinced that the labour market is turning a corner."
For the BoE's monetary policy committee, he said the slowing in private wage growth was a "positive piece of news. The easing in wage inflation will give many on the MPC some comfort that pay growth is moving closer to more target-consistent levels. Further rate cuts seem inevitable, in our view – though questions around timing of rate cuts will only increase from here."
Rob Wood, chief UK economist at Pantheon Macroeconomics, said unemployment holding steady, payrolls falling more than expected and wage growth slowing, "will keep the MPC on track to cut rates again in April, but gives rate setters no need to urgently ease policy", with the next meeting coming in early February.
"The Budget circus crescendo in November continued to weigh on job growth in December while wage growth slowing too will be food for the MPC doves. But there are plenty of details suggesting a stabilising, rather than still deteriorating, labour market."
8.15am: FTSE flops at open
The FTSE 100 has tumbled 80 points in opening trades to 10,115.
Exporters seem to be hardest hit as tariff worries send investors packing, with Burberry, Spirax and Bunzl among the main fallers.
Less than 15 of the shares in index are currently in green. These are led by Informa, Endeavour Mining and Severn Trent.
8am: Kier stormer
Kier Group PLC (LSE:KIE) has delivered a short but busy trading update, confirming a solid first half that keeps it on track to meet full-year expectations, with a record order book and a return to average net cash.
Off to a stormer, one could say for the purposes of a headline?
The order book stood at around £11.6 billion at the end of December, up from £11 billion a year earlier, the FTSE 250 group said, with 94% of revenue for the current financial year already secured.
Month-end net cash averaged £15 million in the first half, which compares with average net debt of £38 million a year earlier, with total cash levels by the year-end now expected to be "substantially" higher than the £58 million recorded a year ago.
Chief executive Stuart Togwell hailed the positive average cash position as "a significant milestone", as he well should.
7.48am: Wise and QinetiQ both on track
A couple of company updates.
Wise PLC (LSE:WISE) reported a slight acceleration in customer growth in its third quarter, and said it remains on track to complete its dual listing in the US in the first half of 2026.
The group now expects full-year profit margins to be at the upper end of its medium-term target range of 13% to 16%, despite the added cost of the planned dual listing.
Elsewhere, QinetiQ Group PLC (LSE:QQ.) said it is on track to meet its financial goals for the year despite what it described as “near-term spending uncertainty” in its core markets.
The defence and security technology company reported strong order momentum, including a string of laser weapons contracts and a five-year Typhoon support deal.
Orders for the year to date now exceed £3 billion, the FTSE 250-listed company said, with an order backlog of around £5 billion and a longer-term pipeline of £11 billion.
7.29am: UK jobs figures mixed
The UK ILO unemployment rate for the three months to November remained at 5.1%, as expected.
Average weekly pay growth also remained at 4.7%, though the previous three-month figures were revised up to 4.8%.
Excluding bonuses, wage growth fell to 4.5% from 4.6%. Private pay growth fell to 3.6% from 3.9%, while public sector pay growth was 7.9%.
More timely figures from December show the number of payrolled employees fell 43K, up from a 33K decline in November and worse than the 20K expected.
The claimant count rate stayed at 4.4% but the November rate was revised down to 4.3%. There were 17.9K new jobless claims, with November's claims revised down from 20.1K to 3.3K.
ONS director of economic statistics Liz McKeown said: “The number of employees on payroll has fallen again, with reductions over the last year concentrated in retail and hospitality, and reflecting ongoing weak hiring activity. Meanwhile unemployment remains at the rate reported last month, up on the quarter and the year.
“While there was a slight increase in vacancies in the latest period, the overall number has remained broadly flat over the last six months, following a long decline.
“Wage growth in the private sector has slowed to its lowest rate in five years, while public sector wage growth remains elevated reflecting the continued impact of some pay rises being awarded earlier than they were last year.”
7.15am: FTSE 100 expected to retreat further, unemployment rate remains flat
The FTSE 100 is expected to continue a cautious retreat as investors reduce their exposure to risk after Donald Trump's tariff threat over Greenland, with UK jobs data also just out.
On the futures market, the London index has been called 41 points lower, after losing 39 points to close at 10,195 yesterday.
Unemployment remained at 5.1% in the three months to November, while payrolled employees fell again, vacancies were roughly flat and private sector wage growth slowed to its lowest rate in five years.
More on that shortly, along with trading updates from the likes of QinetiQ, Keir, Wise and 4imprint.
Wall Street is due to reopen today after a long weekend, with futures pointing to losses over 1% for the major indices.
Asian markets are bathed in red again, led by a 1.1% decline for Japan's Nikkei 225.