9th Feb 2026 06:59
(Alliance News) - Stocks in London are set to open higher on Monday, as markets digest Japan's landslide election victory for Prime Minister Sanae Takaichi alongside fresh turmoil in the UK following the resignation of Prime Minister Keir Starmer's chief of staff.
IG says futures indicate the FTSE 100 to open up 44.6 points, or 0.4% at 10,414.35 on Monday. The index of London large-caps closed up 0.6% at 10,369.75 on Friday.
Sterling was quoted at USD1.3614 early Monday, slightly higher than USD1.3612 at the London equities close on Friday. The euro traded at USD1.1850, higher than USD1.1814. Against the yen, the dollar was quoted at JPY156.41, lower versus JPY157.04.
Political turmoil is brewing in the UK after embattled Prime Minister Keir Starmer's chief of staff resigned on Sunday over the appointment of Peter Mandelson as ambassador to Washington, despite his links to US convicted sex offender Jeffrey Epstein.
"After careful reflection, I have decided to resign from the government," Morgan McSweeney, Downing Street's chief of staff, said in a statement. "The decision to appoint Peter Mandelson was wrong. He has damaged our party, our country and trust in politics itself," he added. "I advised the prime minister to make that appointment and I take full responsibility for that advice."
The 48-year-old Irishman, who maintained a low profile, was dubbed by some as the "most powerful man in politics" after playing a key role in Starmer's emphatic election victory in July 2024. He is credited with helping steer Labour towards a more centrist policy agenda following former leader Jeremy Corbyn's tenure.
The resignation came as the foreign ministry said it was reviewing an exit payment to Mandelson, who was sacked by Starmer last September over his friendship with the late Epstein.
Starmer will face mutinous Labour MPs as he fights for his political survival after the McSweeney's resignation.
He is on Monday expected to address a meeting of the Parliamentary Labour Party.
Scrutiny of Starmer's own judgment is mounting as critics, including some of his MPs, have highlighted that he made the final decision.
In Asia on Monday, the Nikkei 225 index in Tokyo surged 4.2%, after Japan's ruling Liberal Democratic Party, led by Prime Minister Sanae Takaichi, scored the biggest election victory in its history.
Japanese media reported the party won more than two-thirds of seats in the powerful lower house of parliament, making it the first party in post-war Japan to secure such a supermajority on its own.
The landslide gives Takaichi sweeping political power just months after she became Japan's first female prime minister in late October.
In the US on Friday, Wall Street ended sharply higher, with the Dow Jones Industrial Average jumping 2.5% to cross the 50,000 mark for the first time ever. The S&P 500 rose 2.0%, while the Nasdaq Composite gained 2.2%.
In China, the Shanghai Composite was up 1.3%, while the Hang Seng index in Hong Kong climbed 1.8%, after US President Donald Trump said he will host Chinese leader Xi Jinping at the White House later this year as the two sides look to reset ties strained by a prolonged trade war.
Trump made the comments in an interview with NBC News taped Wednesday, the same day he and Xi held a wide-ranging call covering trade, Taiwan, Russia's war in Ukraine and Iran. "He's coming to the White House, yeah – toward the end of the year," Trump said.
The S&P/ASX 200 in Sydney closed up 1.9%. In Australia, household spending growth eased in December, as earlier sales-driven purchases pulled demand forward.
According to the Australian Bureau of Statistics, seasonally adjusted household spending rose 5.0% year-on-year in December, slowing from 6.3% in November. On a monthly basis, spending fell 0.4% in December from a 1.0% increase a month earlier.
Gold was quoted at USD5,030.00 an ounce early Monday, higher than USD4,946.87 on Friday.
Brent oil was trading at USD67.36 a barrel early Monday, lower than USD68.47 late Friday. Oil markets remained focused on geopolitical developments after Iran said it expects further negotiations with the US, citing a "positive atmosphere" during talks held in Oman.
Shortly after the discussions concluded, the US announced new sanctions targeting shipping entities and vessels aimed at curbing Iran's oil exports, though it was unclear whether the move was linked to the talks.
The meeting marked the first direct engagement between US and Iranian officials since US strikes on Iran's nuclear sites in June. Iran's foreign minister Iran's Minister of Foreign Affairs Abbas Aragchi ruled out abandoning nuclear capabilities, insisting on Tehran's right to enrichment. Israeli Prime Minister Benjamin Netanyahu is expected to meet Trump in Washington on Wednesday to discuss negotiations with Iran, his office said.
Back in the UK, employers are reporting "a change in tone" at the start of 2026, according to data published by the Recruitment & Employment Confederation and KPMG on Monday.
The temporary billings index rose to 50.3 points in January from 47.6 points in December, moving above the neutral 50-point mark separating growth from contraction. It marked the first expansion since October. The REC said blue-collar roles were the only category to see an increase in temporary staff demand, while nursing, medical, care and retail experienced the steepest declines.
REC Chief Executive Neil Carberry said: "There have been increasing signs from businesses as we enter 2026 that uncertainty on hiring plans is giving way to action. That does not mean a general hiring upswing, but the 'wait-and-see' period seems to be ending."
In Monday's corporate calendar, a trading update is expected from HgCapital Trust, and full-year results are due from Plus500, Porvair and Wynnstay Group.
In the economic calendar on Monday, US consumer inflation expectations are due.
By Eva Castanedo, Alliance News reporter
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