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This Week in Review | Oil Prices, UK Politics, Tech Stocks (June 26, 2026)

Fisher Investments

This Week in Review covers three major market developments: oil prices falling to pre-war levels around $72/barrel following US-Iran agreement fragility, UK Prime Minister Keir Starmer's resignation with Andy Burnham expected to succeed him, and a tech stock pullback driven by concerns about AI spending outpacing profit growth.

Summary

The episode opens with a weekly market review segment covering three major stories. First, Brent crude oil prices have declined from the low $80s to approximately $73 per barrel, falling back to pre-Iran war levels by the morning of broadcast. While tensions briefly spiked prices on Thursday, they settled around $72. The speakers note that despite the fragile US-Iran agreement, markets have largely moved past the geopolitical shock—oil prices have been falling since hitting a wartime high in April, and capital markets bottomed out in March before bouncing back by mid-April. They emphasize that markets recover from geopolitical shocks faster than expected, and Brent crude futures for 2027 are priced around $70, indicating diminishing strategic importance of the Strait of Hormuz.

Second, the transcript discusses UK political turmoil. On Monday, Prime Minister and Labour Party leader Keir Starmer announced his resignation, though he will remain in post until a successor is chosen. Andy Burnham, the former mayor of Manchester, is widely expected to become the UK's sixth prime minister in seven years. His main rival has already withdrawn, suggesting an uncontested nomination process beginning in July. The speakers argue that while this adds near-term uncertainty, the market impact is minimal because Starmer's vulnerability has been known for months and largely priced into UK stocks and gilts. They note that UK political turnover has become normalized over the past decade, reducing its power to surprise markets.

Finally, the episode addresses a pullback in tech stocks blamed on investor concerns about inflated valuations and excessive artificial intelligence spending. After months of AI-driven gains, the rally reversed as investors fear that even soaring profits won't keep pace with billions spent on data center buildout. The speakers acknowledge pressure on AI leaders to lower prices creates real growth headwinds. However, they counsel that the strong economy and easing oil prices provide encouragement, and the pullback simply reflects the gap between high expectations and reality, creating opportunities for markets to continue climbing the "wall of worry."

Key Insights

  • Brent crude prices have fallen from a wartime high in April to around $72 per barrel by June 26, with futures for 2027 priced around $70, indicating that Brent crude's strategic importance is diminishing
  • Markets bottomed out at the end of March and bounced back by mid-April despite ongoing Middle East tensions, demonstrating that markets recover from geopolitical shocks faster than expected
  • Prime Minister Starmer's resignation and the expected succession of Andy Burnham had minimal impact on UK stocks and gilts because Starmer's vulnerability has been known for months and was already priced into the market
  • UK political turnover has become the country's new normal over the past decade, which has blunted the power of political changes to negatively surprise markets
  • Tech stock pullback is driven by investor concerns that soaring AI profits won't keep pace with billions required to build out data centers, and pressure on AI leaders to lower prices creates real growth headwinds

Topics

Oil prices and geopolitical riskUK political leadership transitionTech stock valuations and AI spendingMarket recovery from shocksInvestor expectations vs. reality

Transcript

[0:06] Hello and welcome to this weekend review. This weekly segment is designed to highlight a few important developments you may have missed this week, what they may mean for markets, and most importantly, the potential impact for investors. To stay uptodate with our latest market insights, subscribe to our YouTube channel or visit fisherinvestments.com. Now, let's review what happened this week. First, oil prices. This week's prices for brink crude, the international benchmark for crude oil, fell from the [0:37] low80s to around $73 per barrel. By Wednesday, prices were back around levels seen before the start of the war in Iran. We saw prices increase momentarily on Thursday as tensions rose, but prices fell back to around $72…

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