Blog

By the end of last week, the Nasdaq plunged more than 4%, the S&P 500 lost 2.6%, and the Dow Jones fell 1.4%. Ironically, it was good news or, more precisely, the fact that the U.S. economy added 172,000 jobs, while payroll figures from previous months were revised upward, that triggered the sell-off, as it gives the Fed more room, if not to tighten monetary policy, at least to keep it unchanged for a longer period.

For instance, according to the CME FedWatch Tool, markets are now pricing in more than a 70% chance of another rate hike. No wonder gold is once again below $4,400.

Yet investors seem to have short memories. U.S. futures opened the new week higher despite rising tensions in the Middle East. Why?

On the geopolitical front, Trump’s Truth Social posts about progress in talks with Tehran appear to have reassured markets once again.

As for monetary policy concerns, attention seems to be shifting toward the upcoming SpaceX (SPCX) IPO, reportedly targeting up to $75 billion, making it one of the largest public offerings in history. The concern is that, despite generating more than $18.5 billion in revenue in 2025, SpaceX lost nearly $5 billion and is still targeting a valuation of roughly $1.77 trillion. The bet appears to be that SpaceX could become another meme stock like Tesla, growing regardless of fundamentals.

Now, if negotiations with Iran stall, if inflation remains stubbornly high, or if economic data continues to undermine hopes for Fed rate cuts, optimism around the SpaceX IPO could eventually turn into an “entire market trap,” as AI-linked companies already account for an outsized share of gains, leaving downside risks elevated. That risk could only increase further once OpenAI and Anthropic go public.

Shares of S4 Capital (LSE:SFOR) traded more than 2% lower on Monday after Morgan Stanley reduced its price target for the digital advertising specialist, pointing to a weaker revenue outlook as clients remain cautious amid ongoing macroeconomic uncertainty.

The investment bank cut its target price to 35 pence from 38 pence while reiterating its “equal-weight” recommendation on the stock.

Revenue expectations revised lower

The move follows updated guidance from S4 Capital, which now expects a low single-digit percentage decline in like-for-like net revenue during 2026. Previously, the company had indicated that net revenue would be only “slightly below” 2025 levels.

Morgan Stanley responded by reducing its net revenue forecasts by 3.3% across fiscal years 2026 to 2028. The broker now expects net revenue of £641 million in 2026, representing a 4% like-for-like decline compared with the previous year.

The revised outlook reflects continued caution among clients and a challenging economic backdrop that has weighed on advertising and marketing spending.

Margin outlook remains unchanged

Despite trimming revenue projections, Morgan Stanley left its profitability assumptions intact. The broker continues to forecast adjusted EBITDA of £83 million for 2026, equivalent to a margin of 13.0%.

That estimate aligns with management’s target of delivering a 100-basis-point year-on-year improvement in margin performance.

The company has also continued to streamline operations, with headcount reduced by 11% compared with a year ago as part of broader efficiency initiatives.

Earnings forecasts cut across the forecast period

Morgan Stanley lowered its adjusted earnings-per-share estimates by 4.9% for 2026 and by 4.5% for both 2027 and 2028.

The broker now forecasts adjusted EPS of 5.6 pence in 2026, rising to 7.0 pence in 2027 and 7.2 pence in 2028.

Its valuation is based on a discounted cash flow methodology using a weighted average cost of capital of 12% and a terminal growth rate of 1.5%.

According to the broker, the higher discount rate compared with peers such as WPP and Publicis reflects S4 Capital’s greater exposure to cyclical advertising spending, its concentration of technology-sector clients and the relatively lower liquidity of its shares.

Wide valuation range reflects uncertainty

Morgan Stanley’s bull-case scenario values S4 Capital at 88 pence per share, assuming net revenue growth accelerates to around 5.5% annually between 2026 and 2029 and adjusted EBITDA expands at approximately 13% per year.

In contrast, its bear-case valuation stands at just 10 pence per share, based on assumptions that artificial intelligence intensifies competitive pressures and that the company loses a major client, resulting in prolonged revenue declines.

Refinitiv data cited in the research note showed analyst price targets currently range from 30 pence to 55 pence. Around 38% of analysts rate the shares “overweight”, while 63% recommend “equal-weight”. No analysts currently have an “underweight” rating on the stock.

Morgan Stanley estimates that organic net revenue fell 8.2% in 2025 and expects a further 4.0% decline in 2026 before growth returns at a modest 1.4% in both 2027 and 2028.

North America remains the company’s largest market, accounting for approximately 60% to 70% of total revenue.

Seraphim Space Investment Trust plc (LSE:SSIT) will be promoted to the FTSE 250 Index from the start of trading on 19 June 2026, marking a major milestone for the specialist SpaceTech investor following the latest FTSE UK Indices Annual Review.

The move comes nearly five years after the company’s IPO and reflects the continued expansion of its portfolio, growing investor appetite for the SpaceTech sector and the successful £137 million C share fundraising completed recently. Entry into the FTSE 250 is expected to raise the trust’s profile among institutional investors, while also benefiting from increased index-related demand and improved share liquidity.

FTSE 250 inclusion highlights growth of SpaceTech platform

The promotion underlines the progress made by Seraphim Space as it has grown into one of the leading listed investors focused exclusively on the global space technology sector. The company believes its new index status will broaden its investor base and further support long-term growth ambitions.

Will Whitehorn OBE, Chair of Seraphim Space Investment Trust plc, commented:

“Our inclusion in the FTSE 250 marks a significant milestone for Seraphim Space Investment Trust and is a clear reflection of the progress we have made in scaling the Company over the last five years and demonstrating the attractiveness of SpaceTech as an institutional asset class. We believe this inclusion will further enhance the Company’s visibility, improve liquidity and support continued growth in our shareholder base.”

Space increasingly viewed as critical infrastructure

Mark Boggett, Chief Executive Officer of Seraphim Space Manager LLP, said the promotion reflects both the company’s evolution and the growing strategic importance of the space sector.

“SSIT joining the FTSE 250 reflects not only the Company’s progress, but the transition of space from a specialist technology theme into a core pillar of global infrastructure. Space has become foundational to how nations operate, compete and secure their future.

The convergence of defence, sovereign capability and data infrastructure is redefining the market, with governments globally investing in resilient space architectures for security, communications and intelligence. This is driving a structural shift where demand is long-term, procurement is strategically funded and commercial innovators are now embedded at the heart of national security systems. As the only listed investment company offering diversified access to this largely privately backed ecosystem, SSIT is uniquely positioned to participate in, and help shape, this next phase of growth.”

The FTSE 250 promotion represents another step forward for Seraphim Space as it seeks to capitalise on increasing institutional interest in a sector that is becoming ever more closely linked to defence, communications, data infrastructure and national security priorities worldwide.

Oil prices surged on Monday, climbing more than $4 a barrel as escalating military tensions involving Israel, Iran and Lebanon raised fresh concerns about global energy supplies and diminished hopes for a near-term easing of the conflict.

Brent crude futures gained $4.42, or 4.47%, to reach $97.15 a barrel by 0609 GMT. U.S. West Texas Intermediate crude futures rose $4.07, or 4.50%, to $94.61 a barrel.

Strike on Iranian petrochemical facility rattles energy markets

Investor concerns intensified after Israel confirmed attacks on military targets across Iran, including a strike on a petrochemical complex in the country’s southwest. The operation came despite reports that U.S. President Donald Trump had urged Israeli Prime Minister Benjamin Netanyahu to avoid further military action.

Israel said it had targeted facilities within the Mahshahr petrochemical complex, marking the first reported attack on Iranian energy infrastructure since the ceasefire agreed on April 8. Iranian officials later acknowledged that sections of the facility had been damaged.

The renewed hostilities have undermined expectations that the broader conflict could soon be resolved and have reduced optimism that oil shipments through the Strait of Hormuz will resume in the near future. Prior to the war, around 20% of global oil and liquefied natural gas trade passed through the strategic waterway.

Crude prices rebound sharply after Friday’s decline

Monday’s advance reversed the losses seen on Friday, when oil markets weakened on expectations that tensions between Washington and Tehran could ease.

Even after recent fluctuations, crude prices remain almost 60% higher than they were before the conflict erupted in late February. However, they are still below the peaks reached in March, when Brent crude briefly traded close to $120 a barrel.

Iran launched a fresh barrage of missiles against Israeli targets on Sunday in response to Israeli operations in Lebanon. Nevertheless, President Trump continued to express confidence that a wider peace agreement remains achievable.

Tehran has repeatedly maintained that any broader deal with the United States must include a lasting ceasefire in Lebanon.

Israel began military operations in Lebanon in March following rocket and drone attacks carried out by the Iran-backed Hezbollah movement. On June 3, Israel and Lebanon announced a ceasefire agreement following negotiations held in Washington.

Tehran signals Hormuz reopening could come with new restrictions

Markets were also closely watching comments from Iran’s ambassador to Russia, who suggested the Strait of Hormuz could reopen but under revised terms.

“Of course, this strait will be open, but with new conditions to be determined by the Iranian and Omani authorities,” Ambassador Kazem Jalali told Russian newspaper Izvestia in an interview published on Monday.

Iran maintains that shipping traffic through the Strait of Hormuz remains heavily restricted, while U.S. sanctions and maritime measures against Iranian ports continue to affect regional trade flows.

Analysts question effectiveness of latest OPEC+ production increase

Meanwhile, OPEC+ agreed on Sunday to raise oil production for a fourth consecutive time in four months in an effort to ease supply pressures.

Despite the announcement, analysts believe the move will do little to increase actual supply. Several member countries remain unable to meet production targets due to logistical and operational constraints. The closure of the Strait of Hormuz continues to disrupt exports, while Russia’s output capacity has been affected by attacks on key infrastructure.

“In the current market, the physical impact of such a decision would be close to zero,” Rystad Energy’s head of geopolitical analysis, Jorge Leon, said in a note to clients.

With geopolitical tensions showing little sign of easing and major energy supply routes still under pressure, traders are continuing to brace for heightened volatility across global oil markets.

Gold prices moved lower on Monday, falling to an 11-week low as investors responded to stronger-than-expected U.S. economic data that reinforced expectations for higher interest rates, while a sharp rise in oil prices added to concerns over inflation.

Spot gold declined 0.8% to $4,296.08 an ounce by 02:49 ET (06:49 GMT), its weakest level since March 23. August gold futures in the United States also fell, losing 1% to trade at $4,322.60 an ounce.

The latest decline follows a steep sell-off on Friday, when bullion dropped more than 3% after the release of robust U.S. labour market figures prompted traders to reassess the likely path of Federal Reserve policy.

Strong employment figures reduce expectations for rate cuts

Government data released on Friday showed the U.S. economy added 172,000 jobs in May, comfortably surpassing market forecasts. Meanwhile, the unemployment rate remained unchanged at 4.3%.

The stronger-than-anticipated employment report led investors to scale back expectations for interest-rate reductions in 2026, helping drive Treasury yields and the U.S. dollar higher. Both developments tend to weigh on gold because the metal offers no yield.

“Despite the lack of consistent messaging in the labour market data, we now have a rate hike fully priced at the December FOMC meeting,” ING analysts said in a recent note.

The U.S. Dollar Index traded little changed during Asian trading hours on Monday after climbing to its highest level in two months during the previous session.

Rising Middle East tensions push crude prices higher

Geopolitical risks also remained a key focus for markets after Israel reported strikes on military facilities in western and central Iran, as well as a petrochemical site near Mahshahr. The attacks marked one of the most significant strikes against Iranian energy infrastructure since the ceasefire agreed in April.

The developments followed multiple rounds of Iranian missile launches targeting Israel in response to an earlier Israeli operation near Beirut.

Oil prices surged close to 5% as traders reacted to the renewed hostilities. The move intensified concerns that rising energy costs could reignite inflationary pressures around the world and complicate monetary policy decisions.

While gold often benefits from safe-haven demand during periods of geopolitical uncertainty, support from risk-averse investors was outweighed by the impact of a stronger dollar and expectations of tighter U.S. monetary policy.

Precious metals broadly weaker

The weakness extended across the precious metals sector. Silver fell 1.2% to $677.00 per ounce, while platinum lost 0.9% to trade at $1,764.58 per ounce.

Industrial metals were mixed. Benchmark copper futures on the London Metal Exchange gained 0.3% to $13,543.33 a tonne, while U.S. copper futures edged 0.1% lower to $6.28 a pound.

IXICO (LSE:IXI) has reinforced its scientific leadership with the appointment of three internationally recognised neuroscience experts to its Scientific Advisory Board, while also launching new research initiatives aimed at advancing imaging biomarkers for Parkinson’s disease.

The company announced that Professor Jeffrey Cummings, a leading authority in Alzheimer’s disease from the University of Nevada Las Vegas, Professor Charles DeCarli, a distinguished neurologist and Alzheimer’s researcher at the University of California, Davis, and Professor Stéphane Lehéricy, a renowned neuroradiology specialist at the Paris Brain Institute, have joined its advisory board.

The appointments broaden IXICO’s expertise across both Alzheimer’s and Parkinson’s disease, supporting the company’s strategy of combining advanced imaging technologies, biomarker analytics and artificial intelligence to accelerate neurological drug development.

Alongside the advisory board expansion, IXICO unveiled two new Parkinson’s-focused scientific collaborations.

The first is a research partnership with the Paris Brain Institute (ICM), where the organisations will undertake a prospective study evaluating novel neuromelanin-sensitive MRI techniques as potential imaging biomarkers for Parkinson’s disease. The project will focus on refining MRI acquisition methods and applying advanced AI-based analysis to improve the reliability and reproducibility of the technology, with the aim of supporting its future use in clinical trials.

In a separate development, IXICO’s Chief Scientific and Medical Officer, Robin Wolz, and Principal Biomarker Scientist, Kirsi Kinnunen, have been invited to join the Michael J. Fox Foundation’s MRI Advisory Committee. The committee brings together leading academic, industry and non-profit organisations to support the development, standardisation and validation of quantitative MRI biomarkers for Parkinson’s research. The initiative seeks to improve the measurement of disease progression and treatment response through greater collaboration on imaging protocols, data sharing and reproducibility standards.

Commenting on the developments, Robin Wolz, Chief Scientific and Medical Officer of IXICO, said: “IXICO’s business proposition is grounded in science, which is why working with some of the world’s most important KOLs ensures the validation and clinical relevance of the services and technology we provide to the biopharma industry. In addition, adding further expertise and collaborative R&D activity, including our research collaboration with the Paris Brain Institute and participation in MRI biomarker advisory activities, IXICO further deepens its presence in the CNS space.”

He added, “I’m delighted to welcome Jeff, Charlie and Stéphane to the Scientific Advisory Board adding knowledge and experience to an already strong group of advisors. We will continue to explore opportunities to work with the most important individuals and organisations pioneering progress towards better understanding, diagnosis, and treatment of neurodegenerative disease.”