Sometimes, being underweight in tech is an advantage. Granted, let’s be honest, it hasn’t been often in recent years. As 2025 draws to a close, with anything AI-related starting to look slightly suspect, technological shortfalls are proving rather useful.

Europe managed a 0.7% gain yesterday while Wall Street continued its descent, dragged down by a Nasdaq 100 seemingly intent on correcting its excesses before even getting to the turkey and chestnuts. The US tech index has now suffered three consecutive down sessions. Investors are walking away from the overcrowded AI trade – it’s the current zeitgeist, a pause for breath while returns on nebulous investments become a little clearer. Still, the Nasdaq 100 remains up 19% year-to-date, so the present pullback must be kept in perspective.

Since the beginning of November, market enthusiasm has waned somewhat: the Global X AI ETF is down 5%, while the equal-weighted S&P 500 is up 2.5%. (This index is useful when one wishes to neutralise the effect of absurdly valued companies – it treats Nvidia the same as the smallest constituent in the index.) I’ve linked a telling chart here for reference.

I touched on the Europe/US performance differential on Monday, and it turns out yesterday’s session allowed the Stoxx Europe 600 to overtake the S&P 500 for 2025, once dividends are included. Not bad, all things considered – at least on the equity front. When it comes to investment flows, however, the Danaides’ barrel is clearly anchored in the United States.

Still, the mood remains heavy on Wall Street, where the November jobs data is highly anticipated this afternoon (along with the delayed October figures). The report is typically released on the first Friday after month-end, but this one was postponed due to the time needed to restart operations following the US government shutdown. Crucially, this is the first fresh official data on the labour market, which has now overtaken inflation as the key determinant of Fed monetary policy. Economists expect 25,000 non-farm payroll additions and an unemployment rate of 4.6% for November. These figures may not mean much in isolation, but the key point is they mark a deterioration from the previous period.

And that deterioration is exactly what markets need in order to maintain faith in the Fed's continued rate cuts. We’re back in familiar territory: “bad news is good news”. In other words, a weak economic indicator is positive for financial markets, because it compels the central bank to maintain accommodative policies – lower rates, the kind of environment investors thrive on.

So this afternoon’s data is the main course, following a starter of PMI activity indicators from the major economies.

Meanwhile, the financial world is keeping an eye on a potential peace deal in Ukraine. The Americans and Europeans have aligned their positions, and the Kremlin appears interested in the latest proposals. Donald Trump has declared that a deal to end the war in Ukraine “is closer than ever”. The situation has helped push Brent crude back down to around USD 60 a barrel, its lowest level since May. An amusing detail: for the first time this year, an ounce of silver is worth more than a barrel of oil. I’d have liked to credit the author of that titbit, which I read in a column this morning, but my whelk-brained memory has failed me.

As silver rallies, bitcoin has tumbled back below USD 87,000, another victim of the tech stock pullback.

Two sectors will warrant close attention today. First, defence, which could react to the Ukraine peace talks. Second, the automotive industry, in light of the global retreat from internal combustion engine bans. Ford announced yesterday that it is scaling back part of its all-electric ambitions, a move that will result in a USD 19.5 billion charge on its books. The market’s reaction has been mildly positive: investors seem to prefer a hefty write-down to the upheaval traditional automakers face from electric vehicles.

In Asia-Pacific, the correction continues, particularly in the tech-heavy markets. Hong Kong, Taiwan and Tokyo are down more than 1%, while Seoul has dropped over 2%. It’s a bit calmer in Sydney and Mumbai, with losses limited to around 0.5%. Europe, which managed to stay in the green yesterday, is set to open in the red this morning.

Today's economic highlights:

On today's agenda: Japan's PMIs, followed by those of France, Germany, the Eurozone, and the United Kingdom; in the United Kingdom, jobless claims and the three-month ILO unemployment rate will also be released; in Germany, the ZEW survey on the current situation and expectations; in the United States, building permits, housing starts, capacity utilization, and industrial production GM, as well as PMIs. See the full calendar here.

  • GBP / USD: US$1.34
  • Gold: US$4,289.71
  • Crude Oil (BRENT): US$60.18
  • United States 10 years: 4.17%
  • BITCOIN: US$86,533.2

In corporate news:

  • GSK receives MHRA approval for Depemokimab, targeting severe asthma and chronic rhinosinusitis with nasal polyps.
  • Shell faces leadership turnover in M&A division following the resignation of Greg Gut after CEO vetoes BP acquisition proposal.
  • Capita PLC enhances collaborations with top Irish brands.
  • Watkin Jones PLC announces a £102 million student housing project in Bedminster.
  • Theon International plc completes placement of RUMP shares.
  • Rio Tinto and partners commit $191 million to a feasibility study for a new iron ore mine in Australia's Pilbara.
  • Holcim acquires a majority stake in Cementos Pacasmayo for $1.5 billion, expected to be EPS accretive in the first year.
  • UBS appoints Beatriz Martin as COO following Mike Dargan's resignation.
  • Fincantieri extends loan maturity for Virgin Cruises’ subsidiary and sets net debt/EBITDA ratio guidance for 2025.
  • Aquila European Renewables PLC finalizes sale of Danish wind assets for EUR 36.6 million.
  • GreenRoc secures a £1 million grant to advance graphite production.
  • Ford announces a $19.5 billion writedown on EV investments, restructuring lineup for profit-positive returns.
  • Uber faces an amended lawsuit from FTC and 21 states over deceptive billing and cancellation practices.
  • Nvidia expands open-source AI platform by acquiring SchedMD and introducing Nemotron 3 AI models.
  • Kimmeridge proposes a $6 billion acquisition of Ascent Resources.

See more news from UK listed companies here

Analyst Recommendations:

  • Land Securities Group Plc: Bernstein maintains its outperform recommendation and raises the target price from GBX 750 to GBX 770.
  • Segro Plc: Bernstein maintains its outperform recommendation and raises the target price from GBX 790 to GBX 860.
  • Imi Plc: JP Morgan maintains its overweight recommendation and raises the target price from GBP 29.60 to GBP 30.10.
  • Carnival Corporation & Plc: Hedgeye Risk Management downgrades to watch list from long.
  • Greatland Gold: Citi maintains its buy recommendation and raises the target price from AUD 10.25 to AUD 11.90.
  • Fresnillo Plc: Morgan Stanley maintains its underweight recommendation and raises the target price from GBX 1690 to GBX 1950.
  • Antofagasta Plc: Morgan Stanley maintains its equalwt recommendation and raises the target price from GBX 2730 to GBX 3000.
  • Glencore Plc: Morgan Stanley maintains its overweight recommendation and raises the target price from GBX 410 to GBX 430.
  • Unilever Plc: TD Cowen maintains its buy recommendation and reduces the target price from USD 71 to USD 70.
  • Pan African Resources Plc: BMO Capital Markets maintains its outperform recommendation and raises the target price from GBP 1.10 to GBP 1.30.