- FTSE rises 82 points to 10,556
- UK unemployment rises to 5.2%
- Pound falls as investors expect sooner BoE rate cut
- IHG impresses with final results and shareholder returns
4.55pm: Record-breaking day
It was a record finish for London stocks, with the FTSE 100 adding 82 points at 10,556.
“European stock indices regained some of Monday's losses despite German economic sentiment coming in weaker than expected and the UK unemployment rate nearly rising to a 5-year high,” IG chief technical analyst Axel Rudolph said.
4.17pm: Mixed gains for London blue chips
The FTSE has hit a new intraday high above 10,545, helped by a wide array of sector gains.
Housebuilders and real estate, defensives, banks and a rebound in the AI scare trade have been driving force for the UK chips on Tuesday.
Housebuilder Barratt Redrow has been top of the leaderboard all day, following results last week and with the unemployment data earlier suggesting an interest rate cut or two might be round the corner.
Sector peer Persimmon, and real estate names have also been on the rise, including Land Sec, Segro, Sirius Real Estate, GPS and Hammerson across the FTSE 350.
Pharma pair AstraZeneca (up almost 14% this month) and GSK, along with other defensives such as utilities and life insurers are also among the risers.
Compass Group, Airtel Africa, Experian, Barclays, Pearson and Diploma are among other blue chips gaining more than 2% on the day.
Fallers have been led by miners, with Antofagasta down 4.4% as it published final results, fresh from hitting all-time highs in recent weeks and almost doubling over the past 12 months.
Precious metals miners Endeavour Mining and Fresnillo are next, down 4.1% ands 2.7%, with gold prices down 2.2% to below $4,900 an ounce, and silver 2.5% lower to $73.5/oz.
Anglo American and mining engineer Weir are down too, with Glencore and BP both around 1% lower too.
Gold's decline has effectively erased last week’s small gains, says market analyst Fawad Razaqzada at FOREX.com.
The yellow metal began the week hovering around the $5,000 per ounce mark early on Monday, briefly nudging above the psychological threshold.
"But ever since then, it has been drifting lower and today broke well below the next support at $4900. US traders are now returning to their desks while China remains largely out of the market.
"With key data due later in the week, we may well see more range-bound trading rather than a clear trend for now. But the near-term gold outlook appears somewhat bearish following the recent volatility."
3.33pm: Warner Bros, Paramount, Netflix
Things are moving again with Warner Bros Discovery (WBD).
WBD says it is restarting talks with Paramount Skydance about a potential takeover proposal after receiving a seven-day waiver from Netflix.
The company’s board has reaffirmed its support for the previously announced Netflix merger.
WBD, which has scheduled a special shareholder meeting for March 20 to vote on its agreed transaction with Netflix, has so far stuck to its binding agreement with Netflix and rejected a series of sweetened offers from Paramount, resulting in the company pursuing a $108 billion (£77 billion) hostile takeover.
Last week, WBD said that a senior representative for Paramount had informally told a board member that it would raise its existing $30-a-share offer by $1 if talks were reopened.
On Tuesday, WBD said it was giving Paramount until 23 February to submit its “best and final offer”.
2.48pm: Mixed start on Wall Street
It's a mixed start for US stocks, with big tech in the red again.
The Nasdaq has opened 0.5% lower, heading negative for a potential sixth week in a row, while the S&P 500 has dropped 0.2%.
Tesla and Micron are among the notable fallers, with Nvidia, Alphabet and Microsoft also in the red.
Going the other way, the Dow Jones has opened 0.2% higher, lifdted by Goldman Sachs, American Express and Apple.
2.22pm: ESG investors soften defence stance (though far from everyone)
Some evidence that investors are apparently rethinking one of the most entrenched taboos in sustainable finance: defence.
A new survey by Hargreaves Lansdown shows a marked softening in attitudes towards arms manufacturers and military contractors, as geopolitical tensions reshape the ESG debate.
When the platform first ran its sustainable investor survey in 2022, nearly half of respondents ruled out firearms entirely, but the this year's figure has fallen to 27%, while discomfort with military contracting has also dropped by 10 percentage points.
(Update: I asked for more detail and HL said 18% are happy to invest in companies that make less than 20% of their revenues from firearms, 40% are happy to invest in the area, and 15% said they don’t have a view on this issue. Discomfort with military contracting fell from 29% in December 2022 to 19% in December 2025. The breakdown from the latest survey was: 19% want to avoid military contracting, 19% are happy to invest in companies that make less than 20% of their revenues from it, 47% are happy to invest, and 15% said they don’t have a strong view on this issue.)
The shift comes against a backdrop of war in Ukraine, persistent instability in the Middle East and growing anxiety in Europe about US security guarantees.
European defence spending reached €380 billion in 2025, up more than 60% since 2020, with several states committing as much as 5% of GDP and the UK planning to raise defence spending to 2.5% of GDP by 2027 and reports this week that an 'ambition' to reach 3% could be accelerated.
The change among investor thinking is far from universal, however, with almost half of women still rejecting firearms exposure, compared with 19% of men. Younger investors are also more wary than older cohorts.
1.09pm: Prediction markets under fire
US state lawmakers and gaming regulators are apparently stepping up efforts to rein in prediction market platforms, according to a report on the Guardian that makes interesting reading for investors in Flutter, Entain, Plus500 and DraftKings.
The argument is that they are “basically gambling but with another name”.
More than 20 federal lawsuits are said to have been filed over whether groups such as Polymarket and Kalshi should be treated as federally regulated financial exchanges, as they claim, or as gambling operators subject to state sportsbook rules.
The crackdown comes as trading volumes surge. Kalshi saw more than $1 billion traded on Super Bowl Sunday alone, while January volumes reportedly approached $10 billion, much of it sports-related.
Betting groups such as Flutter's FanDuel have also entered the space, and Plus500 launched its own platform this month.
DraftKings and Flutter shares both dropped around 12% on Friday after the former missed earnings estimates and provided a lower-than-expected outlook.
12.23pm: Oil prices rise, US futures trim losses but investors 'wary'
Just past midday, and the FTSE is being lifted as some of the index's biggest companies are enjoying some sizeable gains.
Oil giants Shell and BP are up 1.3% and 1.5% as crude oil prices have spiked higher in the past couple of hours, amidst US-Iran talks taking place in Geneva, as well as peace negotiations between Russia and Ukraine, where the US is in attendance too.
Front-month Brent crude popped from just below $68 a barrel to $69. Recall, prices were below $60 in December and have flirted above on and off $70 in the past few weeks.
Drugmakers AstraZeneca, which has regained top spot in the index from HSBC, and GSK are up 1.1% and 2.1%, while banks and utilities are also in demand.
With US markets reopening after the long weekend, stock index futures are in the red, but having recovered a bit from earlier.
Losses are expected to be led by the tech sector, with Nasdaq futures down 0.6%, the S&P 500 down 0.2% and Dow Jones a little below flat.
This weakness has followed a fortnight of losses for the S&P 500, notes market analyst David Morrison at Trade Nation, with AI-related disruption fears weighing on sentiment across multiple sectors as the last week saw the S&P and Dow both fall over 1%.
The Nasdaq dropped over 2%, its fifth straight weekly decline for its longest losing streak since 2022.
"Attention now turns to the Federal Reserve meeting minutes on Wednesday and Friday’s core PCE inflation update," says Morrison.
On the earnings front, Palo Alto Networks reports after the bell on Tuesday, with DoorDash, Walmart, and Wayfair due later in the week.
"Overall, there has been a decline in upside momentum across the US majors since the beginning of this month.
"Many big tech and certain AI-related stocks have taken a hit as investors continue to question the likely return on investment.
"The spending commitments are so large that many cash-rich corporations have halted share buybacks. Some have issued more stock, and others have turned to debt markets to raise funds for AI investment.
"Meanwhile, software companies have come under scrutiny as investors question their business models given growing competition from AI."
He adds that investors "appear wary of adding to their exposure at current levels. They seem to be sitting on their hands and waiting for a catalyst which will either provide a reason to sell or be the trigger to reload and thereby restart the bull market."
11.37am: AI climate claims questioned
Some supporters claim that AI will help "solve climate change", but there is fresh scrutiny on big tech’s climate credentials this morning after a report accused companies of greenwashing over energy-hungry generative AI tools.
An analysis of 154 public statements found that most claims about AI helping to tackle climate change referred to older machine-learning systems rather than chatbots and image generators such as Google’s Gemini or Microsoft’s Copilot.
Researchers, commissioned by campaign groups including Beyond Fossil Fuels and Climate Action Against Disinformation, said they found no example where popular generative AI tools were delivering a “material, verifiable, and substantial” cut in emissions.
Energy analyst Ketan Joshi described the industry’s approach as “diversionary”, likening it to fossil fuel groups promoting limited renewable investments while continuing core high-emitting activities.
The report also examined claims made in an International Energy Agency study and in corporate reports from Google and Microsoft, finding many lacked clear supporting evidence.
The debate comes as AI-driven demand for data centres is pushing up electricity use globally, raising questions over whether the sector’s rapid expansion will sit comfortably with climate targets.
10.42am: AI and bonds
While China is closed for the Lunar New Year holidays, the country continues to impact global market sentiment after Alibaba released its latest AI model, Qwen3.5-plus, which provides high-end performance at one 18th of the price.
"For investors, there is always the concern that this could represent another DeepSeek moment as markets question the justification of huge hyperscaler capex spending and Nvidia’s dominance," says market analyst Joshua Mahony at Scope Markets.
"The growing regularity of AI-led selling pressure across a number of sectors has raised support for defensive stocks and those dealing with physical goods.
"The strength seen for utilities, consumer staples, and manufacturing names does highlight the benefit of diversification that has helped benefit European markets."
Another defensive play that has gathered attention given the risks evident for stockpickers amidst the fast-changing mood in recent weeks has been the trusty US treasury, says Mahony, with US 10-year yields falling to a two-month low.
"Notably, we have also seen significant strength in demand for Japanese bonds in an overnight auction, with yields moving sharply lower despite a projected 28% increase in annual bond issuance in three-years given increased borrowing costs."
UK 10 gilts are also close to 18 month lows after the jobs report.
Markets are now pricing a 80% chance of a March cut from the BoE, says Mahony.
9.55am: Raspberry rebound
Raspberry Pi shares have jumped 20% this morning, though apart from some social media buzz the reason is not immediately clear (to me anyway).
Following a mixed trading update at the end of January, the shares slumped to their lowest level since the 2024 initial public offer, sinking to below their 280p float price for the first time.
On social media, the buzz seems to be centred around how enthusiasm is building around low-cost, do-it-yourself artificial intelligence (AI) projects.
Hobbyists and developers have been showcasing how a Raspberry Pi board can power a $40 “AI command centre”, while open-source robotics projects such as OpenClaw are further highlighting the board’s flexibility in AI-driven hardware builds.
9.33am: London outperforming European stocks
It's a "subdued start" for the London market this morning, says analyst Aarin Chiekrie at Hargreaves Lansdown, though the FTSE is outperforming Germany's DAX or France's CAC, which are both up only around 0.1%.
Housebuilding shares are on the up, though Barratt Redrow, Persimmon and Bellway are not quite topping the 350 leaderboard, up 2.5%, 1.7% and 1.35% respectively.
"Reports continue to trickle out into the media that the UK government is considering tweaking its support for first-time buyers by potentially reviving the Help to Buy scheme, or something similar," says Chiekrie.
"This comes as new home sales are struggling due to buyer affordability issues, and the government’s target of delivering 1.5 million new homes this parliament looks like a difficult hill to climb at this point.
"The key to any government support being effective for potential buyers will be to create a positive cost advantage over renting, likely through shared equity, which should help reduce monthly mortgage payments."
Precious metals miners are among the fallers, and Chiekrie notes that gold prices have dropped more than 1% to around $4,920 per ounce this morning.
"That marks the second consecutive session of losses, partly due to weaker trading volumes resulting from public holidays in key markets such as the US, as well as in China and several other Asian countries for the Lunar New Year."
Brent Crude prices also slipped 1.2% to $67.88 a barrel of Brent, and he notes that the US and Iran are set to resume nuclear talks today.
"There’s speculation that Iran could agree to dilute its most highly enriched uranium in exchange for the full lifting of financial sanctions, but it’s not clear if that will be enough to seal a deal between the two parties."
8.48am: Anto falls
Antofagasta shares are leading the FTSE fallers after it reported annual results and copper prices fell.
Revenue of US$8.6 billion was in line with forecasts but cash costs were a bit higher than expected, though EBITDA was in line with consensus at US$5.2 billion.
However, the final dividend of 48 cents was down on the consensus estimates of 56.5 cents, while there was no change to guidance for 2026.
Dan Lane, analyst at Robinhood UK, said the 53% hike in pre-tax profits and EPS more than doubling "both underscore the positive drivers of higher copper prices and disciplined cost control".
"With strong cash flow, a bumper dividend and medium-term projects on track, the story now turns squarely to the next stage in the copper cycle, which will likely be written in Beijing and global industrial demand."
He sees the structural copper story as "intact" but notes that prices "could swing on Chinese data and governmental policy. These results reinforce Antofagasta’s operational credibility but copper bugs now need to watch China’s economic pulse and broader industrial activity."
8.23am: Interest rates to be cut in March or April?
Some more thoughts on the ONS jobs data, where the headline rate rose to 5.2%, youth unemployment hit a new high of 16.1% and HMRC payrolled employees fell for a fifth consecutive month.
Sanjay Raja, chief UK economist at Deutsche Bank, says the report contains "worrying signs in the labour market", as rising employee costs have "spurred a substitution from labour to capital".
He says the data suggests the unemployment rate could climb higher, with a "little more room to go before we hit the cyclical peak", with the single month jobless rate already sitting at 5.4% and HMRC data suggests more redundancies are ahead.
"Put simply, the jobs market remains stuck. For the Bank of England, today’s data will only add to market expectations that more rate cuts are coming," Raja says, but sticking to his base-case of two more interest rate cuts this year.
George Lagarias, chief economist at Forvis Mazars, says: "The soft underbelly of the UK economy is emitting a distress signal."
As well as unemployment reaching a five-year high, he points out that private sector wages for the first time in two and a half years are not growing above the inflation rate.
"Household consumption constitutes over 60% of the economy and these numbers may eventually begin to scare consumers away from purchases.
"The question for markets and the real economy is whether they are enough to also scare the Bank of England into accelerating much anticipated rate cuts.”
Matt Swannell, chief economic advisor to the EY ITEM Club, picks up on the point made by Rob Wood below, saying the ONS numbers offer some "signs that recent downward momentum might be starting to recede".
He also notes that some members of the BoE's monetary policy committee suggested they were less concerned than before about the strength of pay growth, with settlements nearing a target-consistent pace amid a renewed focus on weak growth and labour market conditions.
The MPC is "likely" to be cut at "one of the next two meetings, but today's data doesn’t offer a clear steer on March or April", he reckons.
8.15am: FTSE opens higher
The FTSE 100 has marched higher in first deals, rising 39 points to 10,505.
Companies hit by the 'AI scare trade' in recent weeks are leading the way: RELX is up 3.3%, Experian 2.45% and Pearson 2.1%.
InterContinental Hotels is also on the early leaderboard, up 1.7% on the back of its final results.
Miners are the main fallers, with Antofagasta and Fresnillo down 2.7% and 1.8% as copper and precious metals fall over 1%.
8am: IHG, Chesnara, Boohoo
Some company news.
Intercontinental Hotels has hiked its dividend 10% and unveiled a $950 million share buyback after a year of record hotel openings.
Life and pensions consolidator Chesnara has agreed to buy Scottish Widows Europe, a Luxembourg-based closed life insurance business owned by Lloyds Banking Group, for €110 million in cash. The deal comes just two weeks after Chesnara closed its £260 million acquisition of HSBC’s UK life business.
Elsewhere, Boohoo, aka Debenhams, is looking to raise about £35 million as it seeks to cut debt and give itself more breathing space. The online fashion retailer said the planned equity fundraise, priced at 20p a share compared to the last close at 22.5p, will create additional liquidity and deliver what it called the “optimal capital structure”.
7.47am: Jobs data analysis
The rise in unemployment, drop in average weekly earnings growth "suggest sharply fading inflation pressures", says economist Rob Wood at Pantheon Macroeconomics.
"Combined with payrolls still falling slightly, the MPC doves have enough to cut rates in March rather than waiting until April, so markets would be right to ramp up the probability of a March cut."
However, he says, other elements of the jobs data suggest stabilisation, with payrolls falling a lower-than-consensus rate and December’s and November’s changes were revised up, with private payrolls falling only 6K month-to-month in January, the smallest drop since January 2025.
"Slowing in payrolls falls suggests the unemployment rate will at least stabilise soon. The months long Budget circus seemed to temporarily derail labour market stabilisation, but job growth can continue to gradually improve now that uncertainty is falling.
"The same message comes from vacancies, which have been broadly stable for eight months."
7.32am: Pound down, FTSE futures up
The pound is down 0.5% versus the dollar as the chances of a Bank of England rate cut at the March meeting have increased due to the rising unemployment rate and softer wage growth.
FTSE futures have ticked up too, with a gain of around 15 points now expected.
7.20am: UN unemployment rate rises
UK unemployment has increased to the highest level in nearly five years, according to figures out this morning from the Office for National Statistics.
The jobless rate rose to 5.2% in the three months to December, the highest since the start of 2021, from 5.1% in November, where it had been expected to remain.
Average weekly earnings excluding bonuses grew 4.2%, down from 4.6% in November and below the consensus forecast of 4.6%.
In more timely data, payrolled employment fell by 11K month-to-month in January, after dropping by 6K in December, better than the consensus forecast of a 20K decline.
December payroll job growth was revised better from an initially estimated -43K month-to-month fall.
7.17am: FTSE 100 to start flat, falls expected in Europe
The FTSE 100 has been called flat on Tuesday, with European and US stock futures pointing lower and gold on the back foot.
London's blue-chip index is expected to open one point in the red, a small step back after adding 27.3 points to close at 10,473.69 on the week's first day of trading.
German and French futures were suggesting much sharper falls, following a mixed session the day before when global volumes were lower due to US and Chinese markets being on holiday.
US markets return later from the long weekend, with futures indicating the Nasdaq may lead losses.
Investors are "no longer hungry for risk", says market analyst Ipek Ozkardeskaya at Swissquote, pointing to the Nikkei down this morning in Tokyo despite a notable fall in Japanese yields on rising bets that Sanae Takaichi would maintain fiscal discipline while supporting the economy (though how that balance would be achieved remains unclear!).
"SoftBank Group, a proxy for Big Tech appetite, is down more than 5.5% at the time of writing, while Nasdaq Composite futures are leading losses among major US indices.
"In the absence of fresh catalysts — and with existing headwinds unchanged — there is little reason for this bearish tech momentum to reverse. On the contrary, concerns around increasingly leveraged AI spending are intensifying."