Monthly Commentary January 2026

The UK equity market started 2026 in the same style as the end of the previous year with a gain of several percent over the month.

Despite a volatile geopolitical background the sterling exchange rate to the dollar hardly changed over the month. Although measured against precious metals the dollar did weaken significantly. However, oil prices did react to international political developments and strengthened appreciably in dollar terms.

Given the strong performance of commodities it was to be expected that Materials was the best performing UK sector in January with a gain well into double digits putting it well ahead of all the others. The next closest was Utilities and, save for two that declined, all other sectors recorded modest gains. Consumer Discretionary and Information Technology were the only two that fell.