Mark Kleinman: What’s in store for the Square Mile in 2026?
Mark Kleinman is Sky News’ City Editor and the man who gets the Square Mile talking in his weekly CityAM column
Not great, not awful: a fair summary of my corporate predictions for 2025. On the plus side, I was right to forecast a bid for ITV, or at least part of it, and correct that Thames Water would avoid nationalisation, at least temporarily. I fared less well when predicting that Tottenham Hotspur would change hands (although it came close), and I looked dismally pessimistic when I said the FTSE-100 would end the year at 7900 points. Here’s hoping I fare better with these ten predictions for the 12 months ahead.
M&A mania
2026 will be a year when global banking M&A returns to the frontline of the corporate landscape – and not only in the US. Emboldened by the gradual loosening of post-crisis regulatory shackles, bank chiefs across Europe, Asia, the Gulf, the Americas and in Britain will embark upon their boldest strategic moves in nearly two decades. I expect Standard Chartered to be taken over as part of the shake-up, and Barclays’ wily chief executive, CS Venkatakrishnan, is likely to be involved in some capacity.
Five-figure FTSE 100?
The FTSE-100 began this year pushing through the symbolic landmark of 10,000 points for the first time. It will not end the year in five figures, though, despite the continued demand for defence stocks. Oil will end the year at $70-a-barrel. And UK interest rates will sit at 3.25% by the time 2026 concludes.
C-suite swaps
2026 will see the usual merry-go-round of changes in FTSE-100 boardrooms. Experian, Informa and J Sainsbury will appoint new chairs, while RELX, AstraZeneca and BHP will all name successors to their current chief executives. A rise in activism will also spark more boardroom exits at companies including SSP and WH Smith. The most surprising boardroom exit of the year, though, will be at Tesco, where chief executive Ken Murphy will announce his exit despite having enjoyed strong support from shareholders for his performance since taking over from Sir Dave Lewis in 2020.
Float or sink
It will be another mixed year for the London Stock Exchange. Its parent company will resist the efforts of a consortium of City figures who enlist private equity backing to carve it out of LSEG with a promise to revive its competitive position. And while Visma, the Norwegian software company, will list in London at the end of the first quarter at a valuation approaching £20bn, other large IPOs in London will be few and far between. The focus, instead, will be on the behemoths of the US tech sector – OpenAI, Anthropic and SpaceX – ensuring the focus continues to be across the Atlantic.
BP, WPP and shareholder activism
Shareholder activism will continue to preoccupy a large number of blue-chip British boards. At BP, Elliott Advisers will succeed in having a nominee elected to the board, where new chief executive Meg O’Neill will initiate a brutal cost-cutting purge; similarly, at WPP, Cindy Rose’s revamp of the marketing services group will not be sufficient to prevent an activist taking a big stake and pushing for a more radical break-up of the empire built over three decades by Sir Martin Sorrell.
PM in a panic
The challenges for Sir Keir Starmer’s government will continue to mount, but he will end 2026 where he begins it, in 10 Downing Street – just – in the absence of a formal leadership challenge. A continued wave of negative news on immigration will further swell support for Reform, which will be further boosted by the declaration of one of Britain’s most influential tabloid newspapers that it intends to support Nigel Farage’s party in the long period leading up to the next general election.
Headline makers
Few industries will see as much change as media. The Daily Telegraph will finally be taken over by Lord Rothermere’s DMGT; the BBC will appoint a left-field outsider as its next director-general; Sky (my employer) will succeed in buying ITV’s broadcasting arm, with the latter’s production business being targeted by private equity investors; and what remains of London’s once-proud Evening Standard will abandon its print edition altogether.
Red tape crusaders
The shake-up of Britain’s economic regulators initiated by a frustrated Starmer and Rachel Reeves will continue. Doug Gurr, the former Amazon UK boss, will be appointed as permanent chair of the Competition and Markets Authority, while the Treasury will snub internal candidates to recruit an outsider as the next chief executive of the Prudential Regulation Authority. But progress in abolishing other regulatory bodies will be virtually non-existent.
Showing mettle
By the spring, a reshaping of what remains of Britain’s once-mighty steel industry will be well underway. Ministers will move to formally nationalise British Steel, the company owned by China’s Jingye Group but which has been under UK government control since April. The move will risk sparking a legal battle with Jingye and a further diplomatic freeze with Beijing; but it will pave the way for a reunification of Scunthorpe’s steelworks with the array of sites which formed part of Sanjeev Gupta’s Speciality Steels UK until the company’s collapse in the summer.
It’s coming home!
And finally, England will end a 60-year wait for victory in the final of a major men’s international tournament by beating Spain in New York on July 19. Elsewhere, harmony in English football will be harder to find than a long-serving Manchester United manager. The Premier League’s case against Manchester City over financial rule breaches will be unresolved until the end of the season, and its verdict will mean that the appeals process could drag on almost until England defend their World Cup in Morocco, Portugal and Spain in 2030.