Weekly Market Update: 27th Mar
27/03/2026
Rachel Winter discusses the unfolding events in the Middle East, a verdict against Meta and Alphabet, and reports of failings at NS&I.
Rachel Winter
Partner, Investment Management
Transcript
Good morning and welcome to the Killik & Co market update. We’ve kept the same first title slide as it’s still relevant – Iran continues to dominate headlines.
This week the market has been very volatile because there have been very mixed messages about what is happening between the US and Iran. On 23rd March, the US president put this post on his social media platform, Truth Social, which stated that direct negotiations were taking place between the two countries, that these were progressing very well, and that US strikes would be postponed for five days.
Markets reacted well to this. Here’s a chart that shows how the oil price has moved within each of the past five full trading sessions. Early on 23rd March, it was close to $115 dollars per barrel. Following the post on Truth Social, the price dropped more than 10% to $97.
However, Iran has since claimed it is not in direct negotiations with the US. The US has then disputed this, and Iran has then disputed that – and the uncertainty has caused the price of oil to rise again – it’s currently comfortably above $100 per barrel.
Equities have also been quite volatile – here’s an updated version of last week’s year to date MSCI world chart. The index moved upwards when it was suggested that the US and Iran were negotiating, but has since declined on the uncertainty.
As things stand at the moment, the US has given Iran a 10 day extension to its demand to reopen the Strait of Hormuz.
Some news on the social media space – a jury in California has found Alphabet – the owner of YouTube, and Meta – the owner of Facebook and Instagram – liable for causing harm to mental health by making their platforms addictive. The companies were asked to pay $3m in damages to the victim. Clearly both companies will appeal, and this is a tiny amount of money in the context of how much these companies are worth, but there is a concern of multiple identical lawsuits. The share prices of both companies did decline when the verdict was published. Here are the share prices of both companies since the start of this year – Alphabet in green and Meta in pink. You can see that both have dropped this week.
We can zoom out and look at a longer time period – here they both are over 5 years – both have doubled over this time period despite the recent set back. We’ll be watching closely for further developments here.
And lastly, the government backed savings bank, NS&I has been criticised for withholding money from thousands of bereaved families. It is thought that over 37,000 families have been impacted, and NS&I could now be in line for millions in compensation. The boss of NS&I has been replaced with immediate effect.
NS&I is an important source of funding for the UK government. It currently holds over £240bn of customer deposits. In the most recent financial year, it raised £9.75bn of financing for the government. Total government borrowing in that year was just over £150bn, so NS&I accounted for about 6.5% of the total.
NS&I is currently a relatively cost effective means of borrowing for the government. As an example, NS&I’s guaranteed income bonds pay annual interest of less than 4%. The 5-year gilt yield is 4.62% - that is the amount of interest the government would have to pay if it issued new bonds.
Gilt yields have risen recently due to the situation in the Middle East. The high oil price means that inflation expectations are higher. When this is the case, investors become less willing to invest in fixed rate securities such as bonds, and their prices will fall. Do give us a call to discuss our thoughts on investing in bonds.
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