London, Feb 9, 2026, 10:54 GMT — Regular session
FTSE 100 slipped 0.1% to 10,360.11 in early London trading on Monday, according to LSEG data. Gold pushed past $5,000, and Brent crude hovered just under $68 a barrel. 1
Markets opened on the back foot as UK politics swung back into focus. Prime Minister Keir Starmer’s chief of staff walked out, and a deepening spat over Peter Mandelson heading to Washington raised fresh doubts about Starmer’s authority. Sterling and gilts bore the brunt, with traders on edge over whether the stability holds. 2
Rate bets thickened the plot. The Bank of England kept its key rate at 3.75% last week, the decision coming down to a close call. Its message landed softer than markets had expected, prompting traders to boost wagers on rate cuts before year-end. 3
The euro gained 0.49% versus sterling, trading at 87.22 pence. The pound barely budged against the dollar, holding at $1.3607. “Expect pressure to remain on both sterling and gilts,” according to Chris Turner, head of global markets at ING. Neil Jones of TJM Europe added, “political uncertainty is on the increase.” 4
NatWest shares dropped 4.5% after the bank struck a deal to acquire Evelyn Partners, a wealth manager, for 2.7 billion pounds including debt, and announced a 750 million pound share buyback. RBC Capital’s Benjamin Toms described the move as “transformational.” Jefferies, on the other hand, flagged the price as steep and cautioned that the acquisition might weigh on earnings per share up to 2028. NatWest projected annual cost savings of around 100 million pounds and estimated its core capital ratio would take a hit of about 1.3 percentage points. 5
Shares of Greggs tumbled as much as 6%, then trimmed losses but remained about 4% lower after Jefferies downgraded the bakery chain to “hold” from “buy.” The broker also slashed its price target to 1,610 pence, warning that increased use of GLP-1 weight-loss drugs could pose a lasting threat to sales. Analyst Andrew Wade cited “rapid uptake of GLP-1 weight-loss drugs” as a headwind for Greggs, noting the company itself has observed customers moving to smaller portions. 6
Globally, the mood steadied. Battered chip stocks bounced, dragging risk assets up and giving sentiment a lift. Investors, meanwhile, stayed on the sidelines ahead of a batch of U.S. data due this week—jobs, inflation, spending—key pieces for anyone watching the Federal Reserve’s next move on easing. 7
London’s story remains tied to its composition. The FTSE 100 skews heavily toward overseas earners—when the pound dips, exporters often catch a lift. But companies more anchored at home? They’re still moving mostly with interest rates and shifts in sentiment.
Still, the risks are clear. A worsening political spat, or data that pushes traders to reassess the timing of rate cuts, could send sterling lower. That would mean higher borrowing costs, hitting the UK’s more rate-exposed sectors hardest.
The yield on the 10-year gilt touched 4.554% early Monday, then slipped to around 4.533%, still up roughly 4 basis points for the session. Rabobank’s Benjamin Picton noted Starmer might get some breathing room from the resignation, though “the impression that his days are numbered” was gaining traction. Next up: traders are eyeing a five-year gilt sale slated for Tuesday, followed by UK growth figures on Thursday. 8
