HL commentary as it happens

Asian and European markets opened down

Asia markets are down today after a strong start to the year, and European markets have opened down too – including the FTSE 100. Some of this will be profit taking, Asian markets had benefited from their best ever start to a year and UK and European stocks have had strong momentum. Gold and silver – both of which hit new record highs at the end of last year – have also fallen, having started the week strong following Monday’s events.

Trump’s erratic approach to tariffs and global diplomacy, and the threat of Russia having its assets seized by global players supportive of Ukraine, has made gold a more attractive neutral reserve for many global central banks. Goldman Sachs estimates that central banks will target around 20% of reserves in the precious metal, and China is currently at around 8%, which – alongside continued geopolitical uncertainty – should prop up the gold price, though we do not expect the returns of 2024 and 2025 to follow this year.

US and UK stock markets hit record highs yesterday

US and UK stock markets hit record highs yesterday – though the FTSE has opened down today as geopolitical concerns bubble. Oil majors and defence stocks, buoyed by the US operation in Venezuela on Monday, helped boost the FTSE 100 and the S&P 500 markets – with the FTSE 100 posting its best day in six months.

This morning paints a more muted picture, as the dust settles and expectations on tailwinds clarify. The market is additionally digesting alarmist threats from the White House overnight – with US President, Donald Trump, emboldened by his success in Venezuela now setting his sights on Greenland. Time will tell if this is just rhetoric, but today’s political focus will be a search for certainty among Europe and NATO members as to what this means for global discord.

Copper hits new highs

Copper pushed through $6 a pound to fresh record highs, driven by expectations that global supply will tighten further this year, and worries that potential new US tariffs on refined metals could squeeze major hubs like London and Shanghai. Demand remains solid too, with copper right at the heart of power‑grid upgrades, renewable energy build‑outs and the surge in data‑centre construction. It’s a backdrop that plays neatly into the hands of the big miners, many of whom have been pivoting hard toward copper in recent years and now look well positioned to benefit from prolonged higher prices.

Oil prices ease after a surprise rise yesterday

Oil eased back this morning with Brent around $61.60 a barrel, giving up a bit of Monday’s surprise jump as traders weighed what US pressure on Venezuela really means for supply. With the country pumping less than 1% of the world’s oil after years of underinvestment, any major near-term disruption looks more bark than bite. Adding to the softer tone, Saudi Arabia cut prices to Asia again, and OPEC+ stuck to its cautious stance, keeping supply steady in a market that already feels well stocked.

Global equities on the front foot

Global equities are starting the day on the front foot, with markets largely brushing aside the uncertainty stirred up by US moves in Venezuela. European and UK indexes are trading higher, and US futures are pointing to a positive open, hinting at a broadly upbeat mood to kick off the day.