10th Feb 2026 06:59
(Alliance News) - Stocks in London are set to open higher on Tuesday, as political pressure on Prime Minister Keir Starmer persists while investors turn their attention to the start of a heavy UK earnings slate led by major blue-chip results.
IG says futures indicate the FTSE 100 to open 8.6 points higher, 0.1, at 10,394.83 on Tuesday. The index of London large-caps closed up 0.2% at 10,386.23 on Monday.
UK political uncertainty remained in the spotlight after Prime Minister Keir Starmer defied calls to resign, insisting he was "not prepared to walk away" following the most serious challenge yet to his leadership.
Starmer's authority has been shaken after Scottish Labour leader Anas Sarwar publicly urged him to step aside, citing "too many mistakes" less than two years after Labour swept to power.
In a dramatic press conference, Sarwar said the situation in Downing Street was "not good enough".
However, as Sarwar spoke, senior Labour ministers moved swiftly to publicly back the prime minister, rallying around Starmer as he seeks to shore up his position.
His judgement has been under scrutiny over the appointment of Peter Mandelson as UK ambassador to the US, despite Mandelson's links to convicted sex offender Jeffrey Epstein.
Sterling was quoted at USD1.3669 early Tuesday, edging up from USD1.3668 at the London equities close on Monday.
The euro traded at USD1.1902 early Tuesday, higher than USD1.1897 late Monday. Against the yen, the dollar was quoted at JPY155.39, lower versus JPY156.04.
EUR/GBP gained ground as pressure mounted on Starmer, with the euro trading at GBP0.8708.
Fawad Razaqzada, market analyst at FOREX.com, said: "The big recovery in risk rally since Friday has benefitted the GBP/USD, making this a pair to trade if Starmer steadies the political ship in the UK.
"But the euro has been a standout winner, with many see Europe representing the most credible alternative to US markets in terms of size and liquidity. What's more, the ECB last week seemed okay with a higher EUR/USD exchange rate.
"Meanwhile, growing political pressure on UK PM Starmer and a dovish-leaning Bank of England has weighed on the pound forecast against non-USD pairs."
In the US on Monday, Wall Street ended higher, with the Dow Jones Industrial Average marginally higher, the S&P 500 up 0.5% and the Nasdaq Composite up 0.9%.
US consumer inflation expectations eased at the short-term horizon in January, according to the Federal Reserve Bank of New York's survey of consumer expectations.
One-year-ahead inflation expectations fell 0.3 percentage points to 3.1%, while three-year and five-year expectations were unchanged at 3.0%.
Median inflation uncertainty declined at the one- and three-year horizons, while rising slightly at five years. Median home price growth expectations slipped to 2.9%, the lowest level since July 2023.
In Asia on Tuesday, the Nikkei 225 index in Tokyo was up 2.3%, extending gains in a post-election rally after Prime Minister Sanae Takaichi's ruling party secured a supermajority over the weekend.
In China, the Shanghai Composite was up 0.1%, while the Hang Seng index in Hong Kong was up 0.5%.
The S&P/ASX 200 in Sydney closed marginally lower, as Australian consumer sentiment weakened in February after the central bank raised interest rates earlier in the month.
The Westpac–Melbourne Institute consumer sentiment index fell 2.6% to 90.5 points from 92.9 in January, remaining below the neutral 100 mark.
However, Australian business confidence showed a modest improvement, with the NAB business confidence index rising to plus three in January from plus two, while business conditions eased slightly to plus seven from plus nine.
Gold was quoted at USD5,026.70 an ounce early Tuesday, lower than USD5,068.99 on Monday.
Brent oil was trading at USD69.04 a barrel early Tuesday, higher than USD68.85 late Monday.
Back in the UK, retailers reported a welcome pick-up in sales in January, data from the British Retail Consortium showed, following a sluggish Christmas period. According to the BRC-KPMG retail monitor, sales increased 2.7% year-on-year in January, beating both January 2025's 2.6% rise and the 12-month average growth rate of 2.3%.
In Tuesday's corporate calendar, the UK earnings season moves into full swing with results from AstraZeneca, Barclays, BP and Coca-Cola HBC.
In the economic calendar on Tuesday, data due include the US NFIB business optimism index and US retail sales for December.
By Eva Castanedo, Alliance News reporter
Comments and questions to [email protected]
Copyright 2026 Alliance News Ltd. All Rights Reserved.