Anthropic’s Pentagon Talks Snag, Pound Falls After UK Wage Data | The Opening Trade 2/17/2026
Watch on YouTube ↗  |  February 17, 2026 at 10:42 UTC  |  1:34:47  |  Bloomberg Markets
Speakers
Kevin Daly — Senior Research Economist, Aberdeen
Andy Chorlton — Fixed Income CIO, Invesco
Ben Gutteridge — Market Insights Strategist, Invesco
Shonali Pinon — UK Economist, Bank of America
Neil Campling — Senior Strategist
Clara Ferreira Marques — Managing Editor, Bloomberg
Vandita Pant — CFO, BHP

Summary

  • UK Macro Pivot: UK labor market is cracking faster than expected (unemployment up to 5.2%, wages cooling to 4.2%). Markets are now pricing an ~80% chance of a Bank of England cut in March.
  • Industrial Software Disruption: A significant thesis shift is occurring in "safe" industrial software (Siemens/Dassault). UBS and market action suggest AI is disrupting "digital twin" moats faster than anticipated, leading to sharp sell-offs.
  • Mining Divergence: Copper has officially overtaken Iron Ore as the primary profit driver for BHP (>50% of earnings). The trade is shifting decisively from China-construction plays (Iron Ore) to global electrification plays (Copper).
  • Goldman's AI Basket: A clear bifurcation in the AI trade is emerging—Long "Defensive/Infrastructure" (Security, Cloud) vs. Short "Vulnerable" (Legacy SaaS, BPO).
Trade Ideas
Ticker Direction Speaker Thesis Time
LONG Ben Gutteridge
Market Insights Strategist, Invesco
Gold has been volatile (down $82 recently) but central bank buying remains a structural constant. Despite short-term fluctuations driven by rate cut repricing, the "debt monetization" and "central bank diversification" themes are unchanged. The dip is viewed as technical noise within a structural bull market targeting $5,000+. LONG Gold on dips. High real rates in the US persist longer than expected, increasing the opportunity cost of holding zero-yield assets. 0:31
LONG Ben Gutteridge
Market Insights Strategist, Invesco
UK valuations are discounted relative to global peers. The BoE is pivoting to cuts. Lower rates usually support equity valuations. The UK offers "life-like" businesses (Energy, Mining, Tobacco) at a discount, providing a hedge against the high-valuation tech concentration in the US. LONG UK Equities for diversification and value catch-up. The UK economy enters a deep recession rather than a soft landing; political instability returns.
LONG Andy Chorlton
Fixed Income CIO, Invesco
JGBs rallied on a successful auction. The market is resetting expectations regarding Japan's fiscal policy and rate path. The "spending spree" fears regarding the new administration are fading, making JGBs tactically attractive again. LONG JGBs (Tactical). Inflation in Japan re-accelerates, forcing the BoJ to hike faster than priced.
GBP /FXB
SHORT Shonali Pinon
UK Economist, Bank of America
UK unemployment ticked up to 5.2% (vs 5.1% exp) and wage growth cooled to 4.2% (vs 4.6% exp). The "sticky inflation" narrative in the UK is breaking due to labor market weakness. This forces the Bank of England's hand. Markets moved to price an ~80% chance of a March cut. Lower yields = Higher Bond Prices (Gilts) and a weaker currency (Pound). LONG UK Government Bonds (Gilts) to capture the yield compression; SHORT Sterling as the yield differential narrows against the USD. Inflation data (CPI) tomorrow surprises to the upside, forcing the BoE to hold.
SHORT Neil Campling
Tech/TMT Analyst
Dassault Systemes and Siemens sold off sharply (Dassault ~8-10%). UBS issued a report questioning the defensibility of industrial design software. Schindler (elevator co) reportedly dropped Dassault to build internal tools. Investors previously viewed complex industrial software (Digital Twins) as a "moat." The inference is that Generative AI allows companies to build these tools in-house cheaper and faster, destroying the pricing power and retention of legacy industrial software vendors. SHORT/AVOID Industrial Software incumbents. The sell-off is an overreaction to a single client loss (Schindler); AI integration might eventually aid these platforms.
SHORT Anchors (Citing Goldman Sachs Note) Goldman Sachs released an "AI Basket" note categorizing tech stocks into "Defensive" and "Vulnerable." The market is moving to "Second-Order" AI thinking. - Longs: Companies providing essential security and infrastructure that AI *requires* (CrowdStrike, Palo Alto, Oracle, Microsoft). - Shorts: Companies where AI *replaces* the core seat-based function or reduces billable hours (Salesforce, DocuSign, Accenture/Consulting). Pair trade: Long the Infrastructure/Security layer, Short the Legacy SaaS/BPO layer. "Vulnerable" companies successfully pivot to AI-agent revenue models faster than expected. 7:30
LONG Vandita Pant
CFO, BHP
BHP earnings beat expectations. Crucially, for the first time ever, Copper accounted for >50% of group profits, overtaking Iron Ore. This signals the structural rotation from "Old Economy" (China construction/Iron Ore) to "New Economy" (Data Centers/Electrification/Copper). BHP is effectively repricing as a copper play, which commands a higher multiple than an iron ore play. LONG BHP as a proxy for global copper demand. A global recession dampens industrial metal demand; China stimulus fails completely. 10:06