# Roundup of the week: 5 December 2025 _A calm political week, but not a quiet one for markets: UK house prices stabilising, US profit margins at sixty-year highs, AI already adding a full percentage point to US growth, and global equities — led quietly by the much-maligned FTSE 100 — pushing back towards all-time highs._ Neil Woodford · 5 December 2025 · 5 min read ![Roundup of the week: 5 December 2025](https://cdn.sanity.io/images/v3acfbvo/production/187269a3c4769ce70484cb9d9dc1694bd24e6aa4-1652x1102.jpg?w=1600&fit=max&auto=format) --- **If you think we have missed something you would like to discuss or would like to send in a question for next week's podcast episode,** [**send us an email**](mailto:hello@noisecancelling.co)**.** This week has been relatively calm from a political perspective, although I suspect there will be quite a lot going on between now and the year-end. December is usually quite a busy time for trading statements and year-end roundups from listed businesses, and, of course, we have two very important central bank meetings in the US next week and later in the UK. As usual, sentiment has shifted this way and that in the lead-up to these meetings, but it now looks odds-on that the Fed will cut, and I expect the MPC to do likewise. In politics, there is not much to comment on this week other than the apparent failure to reach a peace deal between Russia and Ukraine. Russia’s maximalist demands are clearly a bridge too far for Europe and Ukraine, though President Trump appears to believe they could form the basis for a settlement. Either way, given that this latest initiative has failed, it is now up to Europe to stop prevaricating and start backing up warm words of support for Ukraine with action, especially on the interminable discussions on the plan to access frozen Russian assets (over 210bn Euros) to fund military aid to Ukraine. Although it’s been a quiet week, there were a couple of interesting things I noticed that I thought I should comment on here in relation to economics and markets. ## Economics ### UK According to the latest data from Halifax (Britain’s largest mortgage lender), house prices were flat in November, which is quite interesting given all the pre-budget rumours about what would happen to stamp duty and property taxes. This follows a 0.5% increase in October, which takes the average property price in the UK to £300,000 and annual price growth of 0.7%. Perhaps more interestingly, the head of mortgages at Halifax said that affordability was at its strongest since 2015 when comparing property prices to average incomes, which bodes well for both the housebuilding and housing market recoveries I expect to see gather momentum in 2026. ### US Given how fashionable it is at the moment to highlight the supposed fragility of the US economy and its financial markets, something with which I profoundly disagree, I thought that the following data points were worth paying a bit of attention to. According to EPB Research, economy-wide US company profit margins, at just under 20%, are at a sixty-year high and miles ahead of their peak before the TMT bubble burst, when they reached 15%, and also well ahead of the pre-financial crisis, when excesses in the financial system raised margins to about 18%. Also, this week I bumped into some really interesting data produced by Barclays which shows AI -related investment (software, computers, peripherals and data centres) contributed 1% to US growth in the first half of 2025, Given that this investment activity is forecast to grow strongly again in 2026, I am wondering why the likes of the IMF and OECD are so cautious about the outlook for the overall economy. ## Markets After the sell-off in the early part of November, both government bond and equity markets have had a much better few weeks. The S&P is back close to an all-time high, and equity markets in Europe, China and the UK have all followed suit. Interestingly, with very little fanfare and in the face of continued record-breaking selling activity, the UK equity market, represented by the FTSE 100 index, is up just under 19% YTD. This is still a decent margin above the S&P 500 index and the Euro Stoxx. I wonder when FOMO will start to have an effect on those investors looking at this much-neglected market? One other important and interesting data point emerged this week that caught my attention. Concentration in the S&P has increased again following the recent rally in performance of some of the Mag7. Apparently, the top 10% of US stocks by market cap now account for 78% of the total market, an all-time record since the early 1920s. The top 10 stocks account for just under 40% of the S&P 500 index. Government bond yields in the US and in the UK have fallen after the hissy fit of a few weeks ago. Ten-year yields in the US have fallen back to 4.1% and in the UK, the yield is just over 4.4% for the same maturity. In both cases, as official interest rates continue on their downward path in December and in the first half of next year, I expect these yields to follow suit. Finally, as Netflix announces an $72bn takeover of the streaming and studios businesses of Warner Bros Discovery today, I just wanted to mention that my guess is that we will see a significant leg-up in corporate activity and M&A on both sides of the Atlantic in 2026. Although I have a tradition of disagreeing with what Goldman Sachs predicts, on this occasion I agree with their forecast that 2026 will be a record-breaking year for global deal flow. ### Zigup Zigup announced better-than-expected interim results this week (six months to end October) and guided to a full-year outcome above the top end of analysts’ expectations. This integrated “mobility solutions” business (van hire in Spain and the UK, fleet operations, claims and services – vehicle repairs and replacement vehicles) is embedded in the nuts and bolts of the economy and is clearly operating at a level that is exceeding expectations. I take this as a positive indicator of stronger underlying activity in the economies of both Spain and, particularly, the UK than consensus has forecast. ### Baidu Today, Baidu, China’s dominant search engine business, has announced that it is contemplating an IPO of its AI chip business, Kunlunxin, following a recent private fundraising that valued the company at just under $3bn. The move comes in response to China’s desire to develop domestic alternatives to US semiconductors and to end its historic dependence on Nvidia chips. Baidu’s share price responded positively to the news, rising 5% in Hong Kong. ## What to look out for next week. I have already mentioned the Fed’s interest rate decision, which will be the biggest news next week. Consensus expects a 25 bps cut, and I agree that this is by far the most likely outcome. In the UK, October GDP data will be released on Friday, along with other quarterly data. As usual, despite the unreliability of the data, this will attract a lot of attention. It is a pretty quiet week for company announcements among the businesses I follow, but as ever, there are likely to be things happening that will affect them, and I will keep an eye out as usual for anything interesting.