Monday 09 February 2026 6:45 am | Updated: Monday 09 February 2026 8:19 am

FTSE 100 Live: Natwest shares fall after deal; Political jitters in bond market

By: Samuel Norman, Saskia Koopman, Maisie Grice and Maria Ward-Brennan

Keir Starmer's leadership troubles are keeping investors on edge.

Good morning and welcome to the City AM liveblog.

Markets will have a lot to catch up on this morning after the latest escalation in political dramas over the weekend.

Prime Minister Sir Keir Starmer’s chief of staff announced his exit from government amid mounting pressure over the appointment of Peter Mandelson to US ambassador.

Morgan McSweeney fell on the sword, stating appointing Mandelson to the post was “wrong” and he took “full responsibility” for advising the Prime Minister on the move.

It follows Starmer backing McSweeney just days prior at Prime Minister’s Questions, where the Labour leader said “of course” he had full confidence in his top adviser.

McSweeney’s departure may have done little to quell nerves though with two Labour MPs immediately calling for Starmer to follow suit with his own resignation.

The jitters will turn attention back to bond markets, which were taken for a ride last week as questions around Starmer’s future spiked.

The gulf in price between the UK’s short- and long-term debt – known as the yield curve – reached its highest since 2018 last Thursday, in a sign investors were losing faith in the long-term credibility of the UK economy even as the interest rate outlook improved.

And its not just politics that markets will be keeping an eye on. Last week, fears of an AI bubble re-emerged and exploded with a trillion dollar tech sell-off.

The FTSE 100’s softer exposure to tech stocks allowed it to curb major losses but blue-chips such as the London Stock Exchange Group and Relx each suffered a hit of six per cent and 19 per cent respectively.

We’ll be bringing you the latest on what’s on the menu for the City today.

Here’s a few of our top stories from the weekend: