22nd Sep 2026 06:56
(Alliance News) - Stocks in London are set to open higher on Tuesday, building on Monday's solid advance, after US shares were lifted by artificial intelligence buzz overnight.
In the UK, eyes will be on a public sector borrowing reading, in the wake of a report on Monday warning on the UK chancellor's wafer-thin fiscal headroom. The latest KPMG economic outlook estimated that Chancellor John Healey could be left with headroom of about GBP12 billion in the autumn, down from GBP23.6 billion at the time of the spring forecast.
IG says futures indicate the FTSE 100 to open 18.3 points higher, 0.2% at 10,757.31 on Tuesday. The index of London large-caps ended up 79.88 points, 0.8%, at 10,739.01 on Monday.
"What a difference a week can make! Last week started with crude oil prices hitting fresh highs since May, while AI enablers were being battered by news that frontier-model providers like OpenAI and Anthropic were calling for slower progress amid concerns over the potential risks of increasingly powerful AI," Swissquote analyst Ipek Ozkardeskaya commented.
"This week kicks off with crude oil retreating sharply on Middle East peace hopes, and AI enablers roaring on news that Muse AI – Meta's latest personal AI agent – has risen to the top of mobile app charts, reshuffling the cards in favour of the AI trade. Muse AI – capable of drawing data across Meta's apps, connecting with third-party services and completing tasks on a user's behalf – fuelled AI demand expectations across the supply chain, as agents could require significantly more computing power than general-purpose chatbots."
The AI buzz lifted Meta Platforms shares 11%, boosting the wider Nasdaq Composite, which surged 2.3%.
The Dow Jones Industrial Average added 0.7%, while the S&P 500 rose 1.5%.
A weaker Brent price also improved risk appetite on Monday. Brent traded at USD101.72 a barrel early Tuesday, up from USD100.28 at the time of the London equities close on Monday, but it had neared the USD110 level last week.
Quintex Intel analyst Stephen Innes commented: "Saudi Arabia's ability to keep crude moving through the Gulf is pressuring oil lower more than diplomacy alone. Hormuz traffic remains impaired, but rerouting through Ras Tanura and Gulf of Oman transfers is keeping more barrels in circulation. The geopolitical premium has not disappeared, but near-term price direction is increasingly being set by physical flows rather than headlines."
The yield on the US 10-year Treasury eased to 4.96% from 4.97% at the time of the London equities close on Monday. The 30-year yield narrowed to 5.29% from 5.30%.
Sterling rose to USD1.3382 early Tuesday, from USD1.3372 late Monday afternoon. Against the euro, it edged up to EUR1.1661 from EUR1.1658. Versus the dollar, the euro traded at USD1.1471, barely budging from USD1.1470. Against the yen, the buck was flat at JPY157.47 from JPY157.46.
Financial markets remain closed in Tokyo for a public holiday.
In China, the Shanghai Composite was up 0.1%, while the Hang Seng Index in Hong Kong was up 0.3%. Sydney's S&P/ASX 200 added 0.3%.
Gold fell to USD4,325.81 an ounce early Tuesday, from USD4,352.65 at the time of the London equities close on Monday.
Tuesday's local corporate calendar has half-year results from do-it-yourself retailer Kingfisher and full-year results from engineering firm Smiths Group.
Tuesday's global economic calendar has UK public sector net borrowing data and the Richmond Fed manufacturing index in the US.
By Eric Cunha, Alliance News news editor
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