Stocks higher as GDP figures paint mixed picture of growth

UK GDP is estimated to have increased by 1.3% in 2025, the ONS said this morning, beating France, which reported 0.9% growth, Italy, where the economy grew 0.7%, and Germany, where gross domestic product rose just 0.2% last year.

Chancellor Rachel Reeves said:

Fourth quarter GDP data from Japan, the US and Canada are still set to come. Canada’s growth is estimated to have risen 1.3%, which would match the UK, while the US is expected to have grown at a faster rate.

The UK economy expanded by 0.1% in the final three months of 2025, undershooting expectations as speculation over tax rises in Rachel Reeves’s budget weighed on spending.

Figures from the Office for National Statistics (ONS) showed that gross domestic product (GDP) rose 0.1% in the fourth quarter, unchanged from the previous three months. Economists had forecast growth of 0.2%.

The ONS also reported that the economy grew by 0.1% in December on a monthly basis. However, November’s figure was revised down to 0.2% from an earlier estimate of 0.3%.

Liz McKeown, director of economic statistics at the ONS, said the economy had “continued to grow slowly in the last three months of the year, with the growth rate unchanged from the previous quarter”.

For the year as a whole, UK GDP increased by 1.3%, compared with 1.1% in the previous year.

Growth in the latest quarter was driven by higher industrial production, which rose 1.2%, but this was offset by a 2.1% fall in construction output, while services showed no growth, according to the ONS.

Stocks in Asia were mixed overnight, with the Nikkei (^N225) ending flat on the day in Japan, while the Hang Seng (^HSI) falling 0.9% in Hong Kong. The Shanghai Composite (000001.SS) was 0.1% up by the end of the session.

In South Korea, the Kospi (^KS11) led the way and added 3.1% on the day, closing at another another record high. It is the world’s best performer this year thanks to a surge in chipmakers Samsung (005930.KS) and SK hynix (000660.KS) as traders turn to the region’s AI plays.

Across the pond, the S&P 500 (^GSPC) ended the day unchanged, and the tech-heavy Nasdaq (^IXIC) was 0.2% lower despite investors cheering a bumper US jobs report that eased concerns about the state of the world’s top economy, even as they pared back their bets on Federal Reserve interest rate cuts.

The Dow Jones (^DJI) also lost 0.1% after three days of reaching record highs.

Data on Wednesday showed that 130,000 US jobs were created last month, more than double what was forecast, while unemployment unexpectedly dipped.

Good morning, and welcome back to our markets live blog. As usual we will be taking a deep dive into what’s moving markets and happening across the global economy.

Looking at the day ahead, data releases include the UK’s Q4 GDP reading, the US weekly initial jobless claims, and existing home sales for January. Central bank speakers include the ECB’s Cipollone, Radev, Stournaras, Lane and Nagel. Otherwise, EU leaders will be meeting today in Belgium.

Here’s a snapshot of what’s on the agenda today:

• 7am: Trading updates: Unilever, RELX, British American Tobacco, Schroders, Ashmore

• 7am: UK GDP report for December and Q4 2025

• 7am: UK trade report for December

• 9am: IEA oil market report

• 1.30pm: US initial jobless claims report