HL commentary as it happens

US non-farm payrolls in focus (consensus: +62k)

US jobs data are the key economic numbers Wall Street will be watching later. Consensus expectations are for a 62k addition to non-farm payrolls and for unemployment to remain steady at 4.3%. With ADP private payrolls coming in better than expected, the numbers could come in a little stronger. That’s a pretty resilient outcome given the geopolitical backdrop. So far, AI is not proving to be the end of the jobs market as we know it, with skilled labour in particularly high demand. With inflationary concerns running high, a strong print could move expectations for rate cuts further out yet.

Oil price up again as tensions rise in the Strait of Hormuz

Further exchanges of fire in the Strait of Hormuz overnight have sent Brent Crude oil prices up around 1$ to $101 per barrel, with Tehran seemingly in no hurry to make a deal with President Trump. In time, bypasses such as the Israeli Land Bridge and Sharjah–Fujairah Energy Corridor could reduce reliance on this critical energy chokepoint, but none of these are going to be a quick or full fix.

Gilt yields in the spotlight after tough night for PM Kier Starmer

With company results thin on the ground, it’s the macro picture that’s likely to dominate today. 10-year gilt yields are up a couple of basis points to within touching distance of 5%. As the local election results roll in, it’s not looking good for Labour, and the potential for a leadership change is undermining confidence in the UK’s fiscal health. While political winds can change on a sixpence, the gilt yield is a decent proxy for risk-free returns, a key technical driver of share prices which, all other things being equal (they rarely are!), should move in the opposite direction of yields. If government borrowing costs rise further, expect more pressure on the London markets. Events in the Middle East are also weighing on sentiment this morning.

Global markets lean into Middle East optimism

Global markets are still pricing the glass as half full, with yesterday delivering another strong rally despite little tangible progress towards a lasting resolution in the Middle East. The FTSE 100 jumped more than 2%, helped by miners, banks and real estate names, with the 10-year Gilt yield retreating to below 5% as a lower oil price eased some inflationary fears. Futures point to a more measured open today for UK stock markets, with investors turning their attention to local elections, where expectations of a bruising result for Labour look firmly baked in. A poor showing would pile more pressure on Starmer, leaving investors to weigh whether political pressure starts to translate into a different fiscal direction for the UK.

Broad earnings strength drives US records

US futures point to a more muted open today, but the real story is in last night’s close, with the S&P 500 and Nasdaq both hitting fresh records as raw earnings power and hopes of Middle East de-escalation proved a powerful cocktail for equity markets. Profit growth this earnings season is running above 20% at the S&P 500 level for the 80% of companies having already reported. Strength has been broad, from the obvious AI-linked areas like energy, materials and industrials, through to consumer names, utilities and healthcare, which gives this rally a firmer foundation than one built on a handful of obvious AI names alone.

Gilt yields retreat from multi-decade highs

Closer to home, UK borrowing costs remain elevated, though they have retreated from highs of 5.07% for 10 year borrowing and 5.78% on 30 year gilts yesterday. The UK is not alone in dealing with disruption from the Middle East but is particularly vulnerable to higher energy costs. The UK is a net energy importer and already faces some of the highest electricity and gas costs in developed markets. Additionally, the Labour government faces a stern test tomorrow in local elections and voters also go to the polls to elect new Welsh and Scottish Parliaments. Expectations of a bloodbath for Labour, elected with a landslide majority only two years ago, are well-set. This might heap yet more pressure on Starmer, and markets will then be watching carefully for what kind of leader might replace him, and what that means for fiscal stability, taxation, spending, and economic growth.

Brent crude hovering around $108 as Project Freedom paused

Brent crude hit its highest closing price of 2026 on Monday at $114.4 a barrel, before pulling back to around $108 this morning. A meaningful, lasting resolution to hostilities would bring oil prices down and allow refined products and byproducts, such as the precursors for fertilisers, helium required for semi-conductor manufacture, Liquefied Natural Gas (LNG) – would be able to flow again. Equity markets have remained remarkably resilient during this period, as investors continue to look through the supply disruption and inflationary impacts of the war.

FTSE 100 rises 1.4% at open, as S&P, MSCI World Index and MSCI Asia Pacific indices reach record highs 

The FTSE 100 is up strongly this morning, after record closes in the US yesterday and and Asian markets overnight.

Trump announced “Project Freedom” on Sunday, a plan to guide ships through the blocked Strait of Hormuz. The risks became apparent almost immediately, with US and Iranian forces exchanging fire in the contested waterway and Iranian missiles intercepted over the UAE for the first time in weeks. Trump then paused Project Freedom on Tuesday evening, citing progress on a deal. Whether that progress is real or tactical is, as ever, unclear.