"Markets are operating in a fragmented geopolitical environment where security concerns increasingly shape trade, investment, and technology policy. Geopolitical tensions, supply chains disruptions, and intense competition in areas such as artificial intelligence are influencing where capital flows and how risks are priced. Although US growth remains relatively strong, it exists alongside ongoing geopolitical uncertainty, stubborn services inflation, and uneven global policy direction."
"As a result, market optimism is uneven, with investors favoring perceived stability while remaining cautious about risks tied to geopolitics, trade policy, and economic miscalculations. Global markets have opened the year moving at different speeds. US equities remain near record highs, suggesting confidence in earnings durability, yet leadership is narrowing as investors question elevated technology valuations. Japan stands out as a beneficiary of structural reform and currency dynamics, while Europe and the UK remain constrained by weaker growth momentum."
The start of 2026 reflects an economy driven by long-term structural pressures rather than a typical recovery cycle. Markets operate amid fragmented geopolitics where security concerns increasingly shape trade, investment, and technology policy. Geopolitical tensions, supply-chain disruptions, and intense competition in areas like artificial intelligence are redirecting capital flows and altering risk pricing. US growth remains relatively strong but coexists with geopolitical uncertainty, persistent services inflation, and uneven global policy. Investor optimism is uneven, favoring perceived stability while remaining cautious about geopolitically and policy-related risks. Commodity markets diverge: oil signals ample supply, while gold reflects deeper financial anxiety. Saudi Arabia has decided to fully open its stock market to foreign investors to deepen liquidity and attract long-term capital for Vision 2030.
Read at London Business News | Londonlovesbusiness.com
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