Tech selloff, resilient bonds and a pre-Budget UK: the economy and markets on 17 October 2026

Technology stocks fell on Friday on AI and interest-rate worries while bond buyers shrugged off hot inflation data. Elsewhere, the UK economy surprised on the upside ahead of a Budget expected to target banks, and Europe's carmakers got a Franco-German deal.

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Wall Street: a broad technology selloff

According to MarketWatch, software and semiconductor stocks, which have not moved much in tandem this year, fell together on Friday as concerns about AI and interest rates weighed on the market. A separate MarketWatch commentary argues that the technical picture for the Nasdaq Composite points to further weakness; this is the author's opinion rather than an established outcome.

Inflation and bonds

MarketWatch reports that hot consumer and producer price readings did not push Treasury yields higher. Instead, buyers stepped in, suggesting to the author that yields have risen enough to look attractive. On French television, BFM Business highlighted a US producer price index up 5% over one year. Inflation also feeds into benefits: MarketWatch notes a 3.6% cost-of-living adjustment to US Social Security for 2027, covering more than 68 million beneficiaries.

United Kingdom: surprise growth, bank tax debate

The BBC reports that the UK economy grew 0.1% in August, against analyst expectations of a slight contraction; Chancellor John Healey called it a "sign of resilience" ahead of the Budget. The BBC says senior bankers expect to be "on the menu" for higher taxes in the Budget later this month. The Guardian adds that an IMF deputy director in Europe urged the chancellor to look at pensions and welfare savings rather than taxing banks, while supporters of the levy argue banks were bailed out by taxpayers in the financial crisis and can afford to pay more.

Europe: carmakers and consumers

A Franco-German agreement on European autos would make subsidies conditional on vehicles being built in the EU with at least 70% European components, a lower threshold than today's, according to Le Monde, which says it spares Stellantis but could disadvantage Renault. Le Figaro says manufacturers welcome a softer CO2-reduction path, even with the new local-content requirement.

In France, Le Monde reports clothing sales fell 15% in September, blamed on the cost of living and temperatures 3 degrees above seasonal norms. Le Monde also reports that mortgage lending fell by nearly 10% over a rolling year, with rates expected to keep rising in coming months.

Russia and the Gulf

BFM Business reports that, per Rosstat data, high borrowing costs, tax rises and weak demand are pushing more Russian firms into losses, with the number of loss-making sectors four times last year's. Separately, the BBC cites BBC Verify analysis of maritime-agency data showing 12 vessels struck in a week near Hormuz, a record, as oil exports slow.

Companies and institutions

The BBC reports Netflix will cut 1,000 jobs, about 6% of its workforce and its steepest cuts since 2022. The BBC says Anthropic is courting potential investors ahead of a stock market debut, as some investors worry about AI infrastructure spending. The Federal Reserve published minutes of its September 15-16 FOMC meeting on 7 October, and the ECB released Christine Lagarde's IMFC statement on 17 October; the feeds provided gave no further detail on either.

Sources