Chapter 1: What is the main topic discussed in this episode?
The UK stands apart as a place to do business, not because of one advantage, but many working together. Over Ā£10 trillion in capital, four of the world's top universities, a 10-year industrial strategy in action, its stability with dynamism, global reach with local depth. It all adds up to greater growth. Find out more at business.gov.uk slash growth.
News when you want it with Bloomberg News Now. I'm Caroline Hepker.
And I'm Stephen Carroll.
Traders have dumped stocks across the software, financial services and asset management sectors after a new AI automation tool from Anthropic sparked a massive sell-off. The latest release has supercharged disruption fears that have been simmering across the software industry for months. Jefferies, equities trader Jeffery for Vooza,
described the $285 billion route as an apocalypse for software-as-a-service stocks. He added that trading is very much get-me-out style selling. Here's the view of Mandeep Singh, Bloomberg Intelligence's Senior Global Head of Technology Research.
Right now, what we are seeing is the power of these large-angle models in coming up with a new interface, a chatbot or some sort of a simple interface where you can throw in data, you can automate steps of your workflow, but generalizing that everything will be fully automated is a stretch.
Mandeep Singh speaking there. Our software stocks slid from India to Japan following similar declines across the US and European peers.
Almost half a trillion dollars has been wiped off cryptocurrencies in less than a week as the sell-off accelerated. Bitcoin dropped as much as 7%, falling to just under $73,000 on Tuesday, its lowest level since early November.
Famed Big Short investor Michael Burry is now warning that the plunge could deepen into a self-reinforcing death spiral, inflicting lasting damage on companies that have spent the past year stockpiling the token.
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Chapter 2: What sparked the massive sell-off in software stocks?
That's as costs rise to revamp its Italian business and it's set aside more money for souring loans and other risks.
Meanwhile, Santander has announced a ā¬5 billion share buyback this morning after confirming it has agreed to buy Webster Financial for ā¬12 billion. The deal will give Santander a major presence in the northeast of America. It is one of the largest ever US transactions by a European lender.
Spain's biggest lender reported better than expected fourth quarter net income coming in at ā¬3.76 billion.
And some other results we've just gotten in. The British drug maker GSK reporting fourth quarter revenues of Ā£8.62 billion, beating expectations. GSK seeing its 2026 adjusted operating profit growing between 7% and 9%.
Now, the European Union is preparing to pitch a critical minerals partnership to the United States to curb the influence of China. Bloomberg understands that the Memorandum of Understanding will look at several ways to cut dependency through joint projects and export restrictions. Bloomberg's Freddie Fulston has more.
Key pillars of the EU proposal will look at price support mechanisms and plans to jointly source the minerals, which are crucial for modern technology.
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Chapter 3: How are AI automation tools affecting the software industry?
It also recommends ways to shield both markets from an oversupply of outside minerals and suggests the two sides build supply chains with each other. Crucially, the EU plan also insists both sides respect each other's territorial integrity, following US threats to seize the Danish territory of Greenland. In London, Freddie Fullston, Bloomberg Radio.
London's Metropolitan Police have started a probe into politician Peter Mandelson over his ties to Jeffrey Epstein. Authorities are investigating the former minister over alleged misconduct in public office. The news follows Mandelson's resignation from the House of Lords after Prime Minister Keir Starmer called his actions disgusting.
But the leader of the opposition, Kemi Badenoch, questioned Mandelson's previous appointment as UK ambassador to the United States.
I think that the Prime Minister has to take full responsibility, but there are a lot of questions that his Chief of Staff needs to answer. Who knew what and when? Why did the vetting go wrong? Why did they skip over lots of better qualified people and allow our country to be embarrassed in this way?
Conservative Party leader Cammy Badenoch there speaking following the release of US Justice Department files which appear to show Mandelson forwarding internal Downing Street emails to Epstein. The European Commission is assessing whether the former Labour peer breached its code of conduct through contact with Epstein given that Mandelson was the EU's Trade Commissioner from 2004 to 2008.
And those are our top stories for you this morning. So, we have a sell-off in tech and software-related businesses in the US and across Asia. In terms of stock futures for the European market open, it looks a little bit positive. We're up by about a tenth of 1%. But what's the response going to be for those software-related businesses? We'll get into that in a moment.
In terms of the FX markets, the dollar is flat. The Japanese yen weakening 0.4% ahead of election results. Brent crude futures are up by 0.7%, $67.78. So, more tensions between the US and Iran. Gold rebounding 2.4%. We're above $5,000. Massive sell-off in Bitcoin seems to be slowing down and at least stable today, $76,000, just above that level for Bitcoin this morning.
That is a look at where we are in the market, Stephen.
That's news when you want it with Bloomberg News Now. I'm Stephen Carroll.
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