🗞️ Broader Market Consolidation — Geopolitics, AI Stock Weakness, and UK Political Uncertainty

🗞️ Broader Market Consolidation — Geopolitics, AI Stock Weakness, and UK Political Uncertainty

🎯 Overview

Overseas markets may see broader consolidation ahead.

Investor sentiment is being weighed down by:

• 🌍 Geopolitical risks

• 🤖 Weakness in AI-related stocks

• 🇬🇧 Political uncertainty in the UK

Multiple risk factors are unfolding simultaneously, creating a nervous market tone.

🌍 Geopolitical Risks

🇺🇸🇮🇷 United States – Iran

• Third round of nuclear talks held

• Breakdown avoided, but no agreement reached

• Negotiations postponed to a later date

→ Uncertainty remains elevated.

🇵🇰🇦🇫 Pakistan – Afghanistan

• Reports that Pakistan conducted airstrikes in Kabul

• Defense minister stated the two countries are “effectively in a state of war”

→ Fresh tensions are increasing market caution.

🤖 Concerns Around AI Stocks

• Several companies announced restructuring and layoffs

• Tensions reported between the U.S. Department of Defense and Anthropic

• Nvidia posted strong earnings, yet shares faced selling pressure

👉 Signs of overheating correction in AI-related equities
👉 U.S. and European futures trading softer in after-hours

🇬🇧 UK Political Uncertainty

In the February 26 by-election in Gorton and Denton,
the Green Party scored an upset victory.

Some media described it as a “historic defeat” for Prime Minister Keir Starmer’s government.

→ Adds a ceiling to GBP upside.

💱 FX Market (Early London)

USD/JPY

• High: 156.23

• Current: around 156.10

• Hovering near prior NY close (156.13)

• Upside momentum paused

EUR/USD

• Rose to 1.1822 after French GDP and CPI

• Later retreated

• Currently near 1.1795

• Approaching Tokyo low (1.1789)

👉 Month-end flows are distorting directionality.

📊 Key Economic Data Tonight

• France, Switzerland, India, Canada GDP (Q4)

• German employment data

• German flash CPI

• South Africa and Mexico trade balance

• 🇺🇸 U.S. PPI (January)

• 🇺🇸 U.S. Chicago PMI (February)

• 🇺🇸 U.S. construction spending (December)

🎙 Speaking Event

• BOE Chief Economist Huw Pill

🧭 Summary

✔ Geopolitical risks persist
✔ AI equities under corrective pressure
✔ UK politics weigh on GBP
✔ Equity futures softer

At the same time:

✔ Neither USD nor JPY has formed a decisive trend
✔ Month-end flows are amplifying short-term swings

🔎 Conclusion

This is a correction phase without clear direction.

Markets remain highly sensitive to geopolitical headlines and equity performance.

Expect choppy, headline-driven price action,
with rapid intraday swings likely to continue.