Market Report: risk back on the menu as end to US shutdown comes into sight
Matt Britzman, senior equity analyst, Hargreaves Lansdown: “Global markets kicked off the week on a positive note, buoyed by signs that the US government shutdown may soon be resolved. While the standoff hasn’t turned into the market drag many feared a few weeks ago, the prospect of clarity is still welcome. Investors tend to prefer stability and removing this uncertainty allows focus to shift back to earnings season, which is where the real story lies. Relief, rather than euphoria, seems to be the tone – but it’s enough to keep sentiment on the front foot and US futures suggest a positive open this afternoon.
The FTSE 100 opened higher this morning, joining in on the positive momentum felt around the globe, and it’s another busy week for UK company updates. Vodafone’s half-year results are expected to show whether its turnaround plan is gaining traction after struggles in Germany and the UK. Aviva will report third-quarter numbers, where investors want confirmation that strong first-half momentum has continued and that progress on the integration of Direct Line is on track. Rolls-Royce follows with a trading update after a stellar first half, and markets will watch for signs that strength in Civil Aerospace and Defence has held up. Execution risk looms for Vodafone, while Aviva and Rolls-Royce face high expectations – making this a key week for gauging resilience among UK blue chips.
Diageo has named Sir Dave Lewis as its next CEO, effective January 2026, opting for an external hire over interim chief Nik Jhangiani. Lewis brings deep experience in consumer brands from his time leading Tesco and decades at Unilever, though he lacks direct exposure to the spirits industry. Investors may welcome his strong marketing pedigree, but any major strategic reset will take time, leaving near-term focus on navigating tough trading conditions.
Gold climbed more than 1% to around $4,050 an ounce, hitting a two-week high as investors weighed economic jitters against hopes for rate cuts. A softer dollar added fuel to the rally, making the metal more attractive to overseas buyers. While gold rising alongside equities feels counterintuitive, the mix of policy uncertainty and US interest rate cut expectations is keeping this unusual correlation alive.
Oil prices edged higher, with Brent crude climbing back above $64 a barrel after two weeks of declines. The rebound comes as traders await fresh outlooks from OPEC and the IEA, hoping for clarity on supply-demand dynamics amid rising production from both OPEC and US producers. Sanctions on Russian oil remain a wild card, pushing major buyers like China and India to diversify sources, adding another layer of complexity to the market.”