Westminster Wobbled, The City Carried On

This week, the bond market got there before the MPs did. Bond Markets Sent Starmer a 7bp Resignation Note clocked the seven-basis-point gilt jump during the PM's own survival speech — verdict delivered faster than the political one. UK Borrowing Costs Hit 28-Year High as Starmer Wobbles tracked the 30-year gilt to 5.807%, the highest since 1998. Barclays, Lloyds Sink as Starmer Crisis Hits Banks read the equity side of the same trade — three FTSE 100 lenders down 4% on pure political risk, not earnings. UK Permanent Jobs Crash, Temps Hit 2.5-Year High showed the labour market hollowing out underneath it all. And Labour's £2bn Holiday Tax U-Turn Hits Staycations caught the policy own-goal — a tourism levy the government had promised would never pass, now sitting in the King's Speech.

On the corporate desk, the deals and the reads piled up regardless. eBay Calls GameStop's £41bn Bid 'Not Credible' unpacked Ryan Cohen's hostile play — an $11bn meme-stock chasing a $56bn target. ASOS Shares Soar on £66m M&S Lichfield Warehouse Deal captured the strangest tape of the week: ASOS up 12.5%, M&S down 9.8% on the very same trade. E.ON Just Rescued OVO Energy From Collapse marked the UK energy sector quietly turning into a Big Five from a Big Six. London Defence Stocks: Babcock Buyback Meets Avon Surge told the wartime-economy story through Babcock's £200m buyback and Avon's 32% jump in orders.

Westminster wobbled. The City didn't. Now to the rest of the issue — settle in.

Picture this: a Labour government that told the House of Commons it would not pass a tourism tax — and then, in the King’s Speech on 13 May 2026, did exactly that. The Overnight Visitor Levy Bill hands English mayors the power to charge British families a 5% surcharge or £2 per person per night on overnight stays. Trade body UK Hospitality has run the numbers.

Is this the UK jobs recovery? Permanent hiring crashed to 47.5 in April per KPMG-REC — down from 49.2 in March — while temporary placements surged to a 2.5-year high.

Yet here we are. The 30-year UK gilt yield just hit its highest level since 1998 — 5.807 per cent and rising. Sterling fell to $1.352. The FTSE 100 dropped 1 per cent at the open.

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The wartime economy just stopped being abstract. Two London-listed defence names opened the books on Wednesday, and geopolitics is now flowing straight into FTSE 100 cashflow. Babcock International is handing investors £200m via a buyback. Avon Technologies just posted record orders. One of them is also warning that defence valuations look “elevated” — and for anyone tracking London defence stocks, that quiet word might matter more than any headline number.

Picture this: a Prime Minister fighting for his job. A bond market unconvinced. Sir Keir Starmer spent Monday morning delivering a make-or-break speech outside Westminster — and the 10-year gilt yield jumped seven basis points as he spoke. Reform and the Greens are the political rivals; the bond market is the more demanding judge. Below, what the speech contained, what the bond move tells us, and where Labour goes from here.

Forget the easy crypto-fad take. BlackRock (NYSE: BLK) just filed not one but two new tokenised fund products on Friday — a $7bn (~£5.1bn) Treasury liquidity fund moving onchain, plus a brand-new stablecoin reserve vehicle. The world’s biggest asset manager is voting with paperwork. The tokenised finance sector that just crossed $30bn (~£22.0bn) for the first time has its institutional anchor.