Analysis of: FTSE 100 hits fresh record high as gold heads for best day since 2008; SpaceX buys xAI in $1.25tn deal – business live
The Guardian | February 3, 2026
TL;DR
Global stock markets hit record highs as capital consolidates—SpaceX absorbs xAI for $1.25 trillion while AI threatens professional workers. The wealth surge benefits asset owners while workers face automation, grocery inflation, and volatile markets shaped by Trump's erratic trade policies.
Analytical Focus:Class Analysis Contradictions Material Conditions
This live business update presents what appears to be uniformly positive economic news—record stock indices, recovering commodities, and massive corporate deals—yet closer examination reveals deepening class divisions and system instabilities. The SpaceX-xAI merger, creating a $1.25 trillion entity, represents an unprecedented concentration of capital under a single individual with direct state power, while the immediate 8-11% stock plunges in legal and publishing firms following Anthropic's AI release demonstrates how technological advancement under capitalism threatens professional workers rather than liberating them. The article's framing is instructive: volatility is presented as opportunity ('bargain hunters'), speculation as rational market behavior, and worker displacement as mere 'sector headwinds.' The grocery inflation section reveals material reality for working people—with 52.2% of spending now on own-label products, a record high indicating household budget stress—yet this is framed as 'welcome news' because the rate of increase has slowed. Meanwhile, mining giants and asset holders benefit from gold's 87% yearly rise, resources extracted largely from the Global South. The US-India tariff deal illustrates how interstate competition serves capital's interests: India must cease purchasing Russian oil and buy American commodities instead, demonstrating how 'free trade' operates as a mechanism of imperial coordination. The 'TACO trade'—investors betting on Trump backing down from tariff threats—reveals how even political unpredictability becomes profitable for those with capital to speculate, while workers in affected industries bear the real uncertainty costs.
Class Dynamics
Actors: Finance capital (investment managers, trading platforms), Tech oligarchy (Musk), Professional middle class (lawyers, accountants, analysts), Industrial capitalists (mining companies), Working class consumers, Commodity speculators, State actors (Trump administration, Modi government)
Beneficiaries: Asset owners and shareholders in mining, tech, and financial sectors, Elon Musk and SpaceX/xAI investors, Trading platforms like Plus500 profiting from volatility, Multinational corporations benefiting from dollar strength, US commodity exporters gaining Indian market access
Harmed Parties: Professional workers facing AI displacement (legal, publishing sectors), UK households dealing with grocery inflation, Leveraged small traders wiped out by volatility, Indian working class losing cheaper Russian oil, Workers in export industries facing tariff uncertainty
The merger of SpaceX and xAI under Musk—who simultaneously holds significant state influence—represents a fusion of private capital and political power rarely seen. Financial analysts and investment managers quoted throughout frame events in ways serving capital accumulation, while worker perspectives are entirely absent. The India deal demonstrates how core capitalist states can dictate peripheral nations' trade relationships.
Material Conditions
Economic Factors: Precious metals volatility driven by margin requirement changes and speculative positions, Strong dollar benefiting multinational corporations, AI development threatening knowledge-worker employment, Persistent inflation squeezing household budgets, Record stock valuations disconnected from productive economy
The SpaceX-xAI merger consolidates control over AI development, satellite communications, and social media under one entity—representing vertical integration of production, distribution, and ideological apparatus. Mining company profits depend on labor extraction in the Global South while benefits accrue to London-listed shareholders. The AI displacement of legal and publishing workers demonstrates how technological advancement under private ownership destroys jobs rather than reducing work.
Resources at Stake: Precious metals (gold, silver, copper) with significant Global South extraction, AI technology and data infrastructure, Space-based communications and satellite systems, Indian oil import markets ($60+ billion annually), Professional knowledge work being automated
Historical Context
Precedents: Gold's best day since 2008 financial crisis signals similar instability patterns, Tech consolidation echoing Gilded Age trust formation, Tariff negotiations mirror 1930s trade war dynamics, Professional automation continuing pattern begun with manufacturing
This represents advanced financialized capitalism where asset price appreciation generates more returns than productive investment. The Musk consolidation exemplifies monopoly capitalism's tendency toward concentration, while AI displacement of professional workers extends automation's reach beyond industrial production. The 'TACO trade'—profiting from political uncertainty—demonstrates how financialization transforms even policy instability into speculative opportunity, creating a class that benefits from chaos.
Contradictions
Primary: Markets celebrate as record highs generate wealth for asset owners while the same forces (AI development, inflation, trade uncertainty) undermine working and middle-class security—the fundamental contradiction between social production and private appropriation.
Secondary: Gold functions both as safe haven (political instability hedge) and speculative asset (generating the volatility it supposedly protects against), AI promises efficiency while destroying livelihoods, Trade 'deals' presented as mutual benefit while enforcing imperial extraction, Market 'recovery' framed as stability while underlying volatility remains
These contradictions are intensifying rather than resolving. The concentration of tech capital under politically-connected oligarchs, combined with AI-driven professional displacement, may politicize previously quiescent middle-class workers. The grocery inflation pressure, though 'easing,' continues accumulating household stress. The speculative nature of current valuations suggests another correction is probable, while geopolitical tensions (US-Russia-India dynamics) could escalate trade conflicts.
Global Interconnections
The India-US deal reveals how global capital flows shape national sovereignty: India must abandon cheaper Russian oil and purchase American commodities, demonstrating how 'trade agreements' function as mechanisms of imperial coordination. European mining companies profit from resources extracted in the Global South while listing shares in London—the colonial extraction pattern persists in financialized form. The AI companies displacing European professional workers operate primarily from the US, representing a new form of technological dependency. The precious metals volatility illustrates how Global South resources become speculative instruments in Northern financial centers. When margin requirements shift at London and Chicago exchanges, mining operations in South Africa, Mexico, and Peru face uncertain demand—workers there bearing the consequences of speculative decisions made in air-conditioned trading floors. The $1.25 trillion SpaceX-xAI valuation represents capital concentration that exceeds the GDP of most nations, controlled by a single individual with unprecedented political access.
Conclusion
This snapshot of global markets reveals capitalism's current phase: extreme wealth concentration, speculative instability, technological displacement of workers, and imperial trade coordination all occurring simultaneously while financial media presents this as prosperity. The absence of worker voices throughout—replaced by investment strategists and analysts—reflects whose interests financial journalism serves. For working people, the key insight is that record stock prices and their own material conditions move in opposite directions. The professional workers facing AI displacement may represent an expansion of the proletarianized class, potentially creating new constituencies for labor organizing. The extreme concentration of capital under politically-connected individuals like Musk, combined with mounting household financial pressure, represents a volatile configuration that traditional reformist approaches cannot address.
Suggested Reading
- Imperialism, the Highest Stage of Capitalism by V.I. Lenin (1917) Lenin's analysis of monopoly capitalism and finance capital directly illuminates the SpaceX-xAI merger and how multinational corporations extract resources globally while concentrating wealth in imperial centers.
- The Age of Surveillance Capitalism by Shoshana Zuboff (2019) Zuboff's examination of how tech platforms extract value from data and reshape social relations provides essential context for understanding the xAI-SpaceX consolidation and AI's displacement of knowledge workers.
- The Shock Doctrine by Naomi Klein (2007) Klein's analysis of how crises and volatility serve capital accumulation illuminates the 'TACO trade' and how market instability becomes profitable for speculators while harming workers.