In the UK and Europe, equity markets opened with modest gains, supported by broader risk-on sentiment globally. In the UK, recent labour-market data showed the unemployment rate rising to 5 per cent in the three months to September, coupled with a slowdown in wage growth to 4.6 per cent, this has raised expectations that the Bank of England may ease policy in the near term. With a weaker domestic backdrop, gilts enjoyed some support, and longer-dated yields remain under pressure, reflecting investor hopes for future rate cuts.

US markets mounted a strong rebound following the passage of a funding deal by the United States Senate that appears set to end the prolonged federal shutdown. The S&P 500 posted its largest one-day percentage gain since mid-October, and the Nasdaq Composite registered its biggest daily advance since May. However, trading today has been mixed, with the Nasdaq modestly down and investor attention shifting to valuation risks, especially in the AI-heavy tech sector, and the outlook for imminent rate cuts from the Federal Reserve.

In the Asia-Pacific region, markets broadly advanced as investors cheered the US political resolution and anticipated a firmer global growth backdrop. Japan’s Nikkei 225 rose, and South Korea’s KOSPI posted a gain. In contrast, Chinese and Hong Kong equities were somewhat subdued amid domestic economic concerns and a weaker-than-expected pick-up in demand. The regional advance, however, remains tempered by lingering uncertainties over commodity demand and supply-chain dynamics.

Oil prices slipped slightly as the market weighed a growing risk of global oversupply against the improvement in sentiment from the US. The potential increase of OPEC+ production and weak demand from key consumers such as China and India remain key drags on the oil complex despite geopolitical risks. Forward-looking analyses continue to flag limited upside through late 2025 into 2026.

Gold has emerged as a key beneficiary of the risk-on environment combined with expectations of lower interest rates ahead. Prices surged in Asia on renewed interest in safe-haven assets and positioning ahead of possible loosening by central banks. The rising metal price underscores investor hedging against potential macro and political shocks despite improved equity sentiment.

In UK company news, the weaker labour data has created heightened scrutiny of domestically focused firms in the run-up to the UK Budget scheduled for 26 November, where further tax increases and spending adjustments are anticipated. On the corporate front, firms across sectors are recalibrating hiring and investment plans in response to the softening labour market, noting increased cost pressures and subdued consumer demand. Separately, technology and export-oriented UK businesses are showing some resilience thanks to favourable global trends, but remain cautious as currency volatility and supply-chain disruption weigh on outlooks.