Thanks to a series of incremental gains, several indices have returned to their previous highs. The S&P 500, for instance, closed at 6,901 points, eking out a 0.2% gain. The broad US index had briefly pushed higher during trading in late October but ultimately retreated, making the new closing record from 11 December the official peak. The narrower Dow Jones and the small-cap-focused Russell 2000 also posted new highs yesterday. The Nasdaq 100, however, lagged somewhat due to weakness among AI stocks. Oracle shed 11% following its earnings report, and Nvidia slipped 1.5%. After the bell, Broadcom posted solid results, though not strong enough to reignite the AI rally: its shares fell 4.5% in after-hours trading. The silver lining is that the base of gains for US equities has significantly broadened: Wall Street is no longer surfing on tech alone.

In Europe, the Stoxx Europe 600 has not yet hit a new record, but the peak is drawing closer. The index broke through the 581-point threshold yesterday, now sitting less than 1% from its all-time high of 13 November, despite a slump in the defence sector: a major driver of performance in recent quarters. This decline coincides with concessions announced by Ukraine in a bid to secure a ceasefire with Russia. Kyiv has signalled its willingness to accept a demilitarised zone in the Donbas, marking a major concession. Donald Trump, acknowledging the proposal, stated a few hours ago that the United States would send a representative to attend peace talks in Europe this weekend, provided there was a real prospect of progress towards a ceasefire agreement. The mere prospect of a breakthrough dragged oil prices down, though the fall was tempered somewhat by Washington's seizure of a Venezuelan tanker earlier in the week.

On the corporate front, the CAC 40 is set to be reshuffled in the coming days, with Eiffage set to replace Edenred. This change reflects the transformation and structuring of construction group Eiffage, now a leader in concessions, specialist engineering and energy. Meanwhile, several articles this week have focused on Cisco, the US networking giant. Why? Because its share price has, for the first time in 25 years, surpassed its March 2000 peak: just before the dot-com bubble burst. It has taken all this time for the company, once lauded for its role in the rise of the internet, to reclaim those levels.

Naturally, some have drawn comparisons with Nvidia, which sits at the heart of AI in 2025 much as Cisco once did with networks. While bold, the analogy is worth contemplating: long-term trajectories can offer valuable lessons for investors. 

In the Asia-Pacific region, markets are broadly higher to close the week. Japan, Australia, South Korea and Hong Kong are all up more than 1%, while India and Taiwan are posting gains of around 0.5%. Despite Broadcom’s after-hours slide in the US, European futures are pointing upwards.

Today's economic highlights:

On today's agenda: industrial production in Germany; the harmonized CPI of the eurozone and the CPI in Germany; the monthly GDP in the United Kingdom; the harmonized CPI of the eurozone and wages in France. See the full calendar here.

  • GBP / USD: US$1.34
  • Gold: US$4,281.99
  • Crude Oil (BRENT): US$61.55
  • United States 10 years: 4.16%
  • BITCOIN: US$92,579.6

In corporate news:

  • GSK receives FDA approval for BLUJEPA, an oral treatment for uncomplicated urogenital gonorrhea.
  • PwC forecasts a 3.5% increase in UK Christmas spending to £24.6bn.
  • Generali maintains an A+ financial strength rating from AM Best, ending asset management talks with BPCE and Natixis.
  • Loomis announces a goodwill impairment charge of approximately 320 million SEK for Q4 2025.
  • Kitron secures a €17 million contract to supply electronic components for war vehicles.
  • Kesko reports a 3.9% increase in November sales.
  • BNP Paribas in exclusive talks to sell its 67% stake in Morocco's BMCI, potentially boosting its CET1 ratio by 15 basis points.
  • Oracle sees increased scrutiny on its credit default swaps due to rising debt from AI data center investments.
  • Walt Disney invests $1 billion in OpenAI, licensing characters for AI-generated content on Sora.

See more news from UK listed companies here

Analyst Recommendations:

  • Tbc Bank Group Plc: Wood & Company Financial Services upgrades to buy from hold and reduces the target price from GBP 53.10 to GBP 47.90.
  • Informa Plc: Bernstein maintains its outperform recommendation and raises the target price from GBX 1060 to GBX 1140.
  • Shell Plc: ING Bank downgrades to hold from buy and reduces the target price from EUR 35 to EUR 33.70.
  • The Rank Group Plc: Peel Hunt maintains its buy recommendation and reduces the target price from GBP 2 to GBP 1.75.
  • Entain Plc: Morgan Stanley maintains its overweight recommendation and reduces the target price from GBX 1310 to GBX 1150.
  • Ocado Group Plc: Morgan Stanley maintains its underweight recommendation and raises the target price from GBX 150 to GBX 170.
  • British American Tobacco P.l.c.: Investec maintains its sell recommendation and raises the target price from ZAR 86000 to ZAR 97500.
  • Diageo Plc: Barclays maintains its overweight recommendation and reduces the target price from GBP 26.50 to GBP 25.50.
  • Drax Group Plc: JP Morgan maintains its overweight recommendation and reduces the target price from GBP 10 to GBP 9.60.
  • Centrica Plc: JP Morgan upgrades to overweight from neutral with a price target raised from GBP 1.79 to GBP 2.03.
  • Severn Trent Plc: JP Morgan downgrades to neutral from overweight and reduces the target price from GBP 30.50 to GBP 29.75.
  • The Berkeley Group Holdings Plc: Goldman Sachs maintains its sell recommendation and raises the target price from GBX 3714 to GBX 3873.