Wealth Club’s Chief Investment Strategist Susannah Streeter assesses how the FTSE 100 is pausing after its record run as easing Iran tensions weigh on oil and gold, while Wall Street heads higher on resilient earnings and surging AI demand at TSMC. Attention is also shifting to the Arctic, where US ambitions in Greenland are adding a fresh geopolitical edge to markets.
Susannah Streeter, Chief Investment Strategist, Wealth Club:
‘’The FTSE 100 looks set to take a breather after reaching fresh records. Futures indicate a flat start to trading as some of the trends pushing the index higher ease off at the end of the week. With the threat of immediate action in Iran having receded, gold prices have fallen back, limiting progress for mining stocks. Energy giants also look set to be on the back foot, with oil prices in retreat, as the threat of disruption of Iran’s oil output recedes.
Wall Street has been on a roll, with the earnings season so far giving plenty of reasons for cheer, and futures indicate a higher open. The AI juggernaut clearly has further to run, with demand for AI chips seemingly insatiable for now. The surge in demand for AI products manufactured by TSMC has pricked up the ears of the US administration. It’s agreed a deal for a reduction in tariffs for Taiwan, if companies like TSMC base more chip factories on US soil. If President Trump sees success or the potential for greater gains, he wants a piece of the action. This is evident in his interventionist foreign policy. Following the action in Caracas, the ousting of Maduro and the seize of control of the country’s oil, the US is already selling Venezuelan crude at 30% higher prices.
While tensions appear to have calmed to some extent in South America and the Middle East, the focus has shifted North. Geopolitics have turned icy, with the future of Greenland casting a chill over transatlantic relations. Trump’s ambitions to take over the territory have been broadcast loud and clear, but risk destroying the NATO alliance and setting off a fresh trade war. As European troops arrive on the island for exercises and as a show of unity with Denmark, senior politicians have also been attempting to make the US position trickier. France’s Finance Minister Roland Lescure has warned US Treasury secretary Scott Bessent that if the US seizes the semi-autonomous territory, it would endanger Europe’s economic relationship with Washington.
The US says owning Greenland is strategically important and crucial for national security, enabling it to launch operations against adversaries, there are other interests at stake. The island is rich in minerals, particularly rare earths, crucial for the US tech industry, and as ice sheets melt deposits become more accessible. Current indigenous rights limit mining opportunities but under US control it’s likely that such protections would be eroded to enable greater exploitation. The Arctic is set to stay the focus of internation rivalry as climate changes creates new shipping routes, and opportunities for resource extraction.’’
