The Week Ahead (19-23 Jan): GDP beats expectations, will earnings follow?

Welcome to The Week Ahead. On Thursday, we learned that the UK economy itself beat expectations in November, printing GDP growth of 0.3%. That beat forecasts of 0.1% and erased the 0.1% decline seen in October.
Perhaps more significantly, we also learned that the German economy grew by 0.2% in 2025, after two straight years of recession.
This data is backward-looking, of course, and neither the UK nor German economies seem likely to deliver vigorous growth in 2026. But modest growth is certainly better than the alternative.

Source: Office for National Statistics
Company news so far this year has suggested that companies operating in economically-sensitive sectors such as retail and hospitality are enjoying mixed fortunes.
While post-Christmas updates from pub chains Mitchells amp; Butlers and Fuller, Smith amp; Turner have been relatively upbeat, reports from retailers have been a little more mixed.
The housing market is another area where commentary has remained cautious. FTSE 100 builders Persimmon and Taylor Wimpey both managed to sell more homes last year, despite uncertainty around the impact of November’s Budget. However, social housing and build-to-rent specialist Vistry suffered a fall in output as its...