- FTSE higher despite soft GDP print
- US markets flat, but software selloff continues
- RELX ignores the noise, buyback raised
- Oil prices rise, but it’s not a one-way street
Matt Britzman, senior equity analyst, Hargreaves Lansdown:
“UK markets are set to open higher, brushing off a lacklustre GDP report that showed the economy barely moving at the end of last year. Growth in Q4 was muted and narrowly driven by services and government spending, a reminder that private‑sector momentum remains thin despite hopes that Q1 will look a little brighter. That leaves the bigger picture unchanged: a fragile growth outlook, softer inflation ahead, and a Bank of England that should have room to cut rates over 2026.
US markets looked flat on the surface, but beneath the calm, it was a volatile session, with solid breadth in the S&P 500 masking weakness in the tech‑heavy Nasdaq. This is 2026 in a nutshell: blink, and you’re punished, as perceived AI disruption continues to separate winners from losers. Shopify fell close to 7% in a wild swing from +11% pre-market as investors continued to fret about its place in the AI pecking order. Financials stayed under pressure, but capital goods shone, with Caterpillar and Deere pushing fresh highs on a strong jobs report that pushed rate‑cut hopes further out.
On the topic of perceived AI losers closer to home, Five Shares to Watch pick RELX delivered another characteristically strong set of results. Its data and analytics businesses have been in the direct line of fire as new AI tools emerge, but the numbers once again showed a company executing well. The challenge for high‑quality, consistent performers is that when sentiment turns sour, there’s rarely a single blockbuster set of results to instantly silence the doubts. While the pace of AI innovation is a genuine risk, the selloff has raced well ahead of reality for a business that still looks far more like an AI winner than a casualty. This is a chance to pick up a proven, resilient business at an unusually attractive valuation – management clearly agrees, stepping up buybacks to take advantage of the recent share weakness.
Oil prices pushed higher again, with Brent hovering around $70 a barrel, as geopolitical nerves around US‑Iran tensions continued to do the heavy lifting. Talk of diplomacy has done little to calm traders, who remain focused on the risk of supply disruption, even as OPEC stuck to its demand forecasts and signalled no change in its supply stance. That said, the rally is running into resistance, with US inventories jumping sharply and the IEA likely to remind markets that a global surplus is still lurking in the background later today.”
The author holds shares in RELX.
