UK's Starmer didn't know Jeffrey Epstein. But the prime minister's job is under threat

LONDON (AP) — Keir Starmer never met Jeffrey Epstein. But the British prime minister’s job is under threat because of the fallout from the late sex offender’s global web of relationships.

Friendship with Epstein has already brought down a British royal – Andrew Mountbatten-Windsor, formerly known as Prince Andrew – and U.K ambassador to Washington Peter Mandelson, fired by Starmer over his links to the financier.

Now new revelations have plunged Starmer’s center-left government into turmoil.

The prime minister is facing mounting pressure from within his governing Labour Party over his decision in 2024 to appoint Mandelson, a veteran Labour politician, to the Washington role despite his ties to Epstein. Just how close those ties were has been exposed in newly released documents that have dominated headlines in the U.K.

Starmer apologized on Thursday to Epstein’s victims, saying Mandelson had repeatedly lied and “portrayed Epstein as someone he barely knew.”

“I am sorry, sorry for what was done to you, sorry that so many people with power failed you," Starmer said. “Sorry for having believed Mandelson’s lies and appointed him.”

Critics believe it’s an error that could end Starmer’s premiership.

“He is now essentially a boxer on the ropes,” said Rob Ford, professor of political science at the University of Manchester. “His administration could fall over tomorrow, or it could stagger on for months or even years. (But) his authority is seriously shot.”

Starmer fired Mandelson, 72, in September after emails were published showing that he maintained a friendship with Epstein after the late financier’s 2008 conviction for sex offenses involving a minor. Epstein committed suicide in a jail cell in 2019 while awaiting trial on U.S. federal charges accusing him of sexually abusing dozens of girls.

Documents published last week by the U.S. Justice Department contain new revelations, including papers suggesting Mandelson shared sensitive government information with Epstein after the 2008 global financial crisis, and records of payments totaling $75,000 in 2003 and 2004 from Epstein to accounts linked to Mandelson or his husband Reinaldo Avila da Silva.

There are also chatty, jokey messages pointing to a much closer relationship with Epstein than Mandelson had disclosed.

British police are investigating Mandelson over potential misconduct in public office. He is not accused of any sexual offenses and says he never witnessed any sexual wrongdoing,

Mandelson was chosen as ambassador because his trade expertise, contacts and mastery of the political “dark arts” were considered assets in dealing with U.S. President Donald Trump's second administration.

Critics say Starmer was, at best, naive in not recognizing the risks involved. Aside from his association with Epstein, Mandelson twice had to resign from senior government posts because of scandals over money or ethics.

In the House of Commons on Wednesday, Starmer answered “Yes” when asked whether the vetting process in 2024 had revealed that Mandelson's friendship with Epstein continued after the latter's 2008 conviction.

The answer sent shock waves through the chamber. On Thursday Starmer said he had meant only that it had “been known publicly for some time that they knew each other.”

The government plans to release files related to the vetting process that it hopes will exonerate Starmer and show Mandelson lied. But the government is not entirely in control of the process. Some documents are likely to be held back because of the police investigation. Others will be reviewed by Parliament’s independent Intelligence and Security Committee for potential national security implications.

Labour lawmaker Paula Barker said the prime minister “has shown that his judgment is questionable.”

“I think he has a very long way to go to rebuild trust and confidence with the public, and trust and confidence within our party," she told the BBC.

Starmer has faced a string of setbacks since he led Labour to a landslide election victory in July 2024. He has struggled to deliver promised economic growth, repair tattered public services and ease the cost of living. He pledged a return to honest government after 14 years of scandal-tarred Conservative rule, but has been beset by missteps and U-turns over welfare cuts and other unpopular policies.

Despite his struggles on the home front, Starmer has been praised for his work on the world stage. He has played a key role in maintaining European support for Ukraine, and in keeping Trump engaged with peace efforts and NATO. He has also worked to rebuild ties with the European Union after the U.K.’s acrimonious departure from the bloc in 2020.

Labour consistently lags behind the hard-right Reform UK party in opinion polls, and its failure to improve had sparked talk of a leadership challenge, even before the Mandelson revelations.

The Epstein files may have brought a challenge closer, but key rivals are holding back, for now.

Senior lawmaker Angela Rayner, a popular figure on the left of the party, is still stinging after being forced to resign as deputy prime minister in September for failing to pay enough tax on a home purchase. Health Secretary Wes Streeting, a star of Labour’s right, was close to Mandelson in the past.

Some Labour lawmakers are calling for Starmer to fire his top aide Morgan McSweeney, a powerful backroom figure mistrusted by many Labour lawmakers, and widely seen as a key force behind Mandelson’s appointment.

Legislator Karl Turner said the prime minister should “get rid of those advisers who frankly have given terrible advice to him over these weeks and months.”

On Thursday Starmer vowed to carry on doing the “vital work” of governing.

But more potential flashpoints loom. Labour may lose a long-held seat in Parliament in a Feb. 26 special election in Greater Manchester. The party is also expected to fare badly in regional and local elections in May.

Ford said that “whenever the moment comes when Starmer does finally leave, either of his own volition or because his MPs oust him ... It will all be traced back to appointing Peter Mandelson."

Newspaper front pages are on display at a News agent in London, Thursday, Feb. 5, 2026. (AP Photo/Kin Cheung)

British Ambassador to the United States, Peter Mandelson speaks during the rededication ceremony of the George Washington Statue in the National Gallery in London, Wednesday, June 18, 2025. (AP Photo/Kirsty Wigglesworth)

FILE - British Prime Minister Keir Starmer, right, talks with Britain's ambassador to the United States Peter Mandelson during a welcome reception at the ambassador's residence on Wednesday, Feb. 26, 2025 in Washington. (Carl Court/Pool Photo via AP, file)

Britain's Prime Minister Keir Starmer adjusts his glasses as he waits to deliver his speech at Horntye Park Sports Complex in St Leonards-on-Sea, East Sussex, England, Thursday, Feb. 5, 2026. (Peter Nicholls/Pool Photo via AP)

Britain's Prime Minister Keir Starmer delivers a speech at Horntye Park Sports Complex in St Leonards-on-Sea, East Sussex, England, Thursday, Feb. 5, 2026. (Peter Nicholls/Pool Photo via AP)

FILE - Britain's Ambassador to the United States, Peter Mandelson, speaks during a reception at the ambassador's residence on Feb. 26, 2025 in Washington. (Carl Court/Pool Photo via AP, File)

Britain's Prime Minister Keir Starmer delivers a speech at Horntye Park Sports Complex in St Leonards-on-Sea, East Sussex, England, Thursday, Feb. 5, 2026. (Peter Nicholls/Pool Photo via AP)

Britain's Prime Minister Keir Starmer delivers a speech at Horntye Park Sports Complex in St Leonards-on-Sea, East Sussex, England, Thursday, Feb. 5, 2026. (Peter Nicholls/Pool Photo via AP)

NEW YORK (AP) — A sharp drop for Google's parent company is dragging the U.S. stock market lower on Thursday, while prices for bitcoin, silver and gold weaken. Yields are also sinking in the bond market following discouraging news on the U.S. job market.

The S&P 500 fell 1.1% and is heading toward its sixth loss in the seven days since it set an all-time high. The Dow Jones Industrial Average was down 425 points, or 0.9%, as of 10:10 a.m. Eastern time, and the Nasdaq composite was 1.5% lower.

Alphabet weighed on the market and sank 4.5%, even though the parent company of Google, YouTube and other businesses reported a stronger profit for the latest quarter than analysts expected. Investors focused instead on how much Alphabet is spending on artificial-intelligence technology and questioned whether it will all prove worth it.

Alphabet said its spending on equipment and other investments could double this year to roughly $180 billion. That blew past analysts’ expectations of less than $119 billion, according to FactSet.

In the bond market, Treasury yields sank after a report said the number of U.S. workers applying for unemployment benefits jumped last week by more than economists expected. That could be a signal that the pace of layoffs is accelerating.

Some economists suggested last week’s rise could be statistical noise, and the total number remains relatively low compared with history. But a separate report said that layoffs announced by U.S.-based employers surged last month. The 108,435 was the highest number for a month since October, according to global outplacement and executive coaching firm Challenger, Gray & Christmas. For a January, it’s the worst since 2009.

A third report from the U.S. government said that employers were advertising fewer job openings in December than both the month before and year before.

Weakness in the job market could push the Federal Reserve to cut interest rates to support the economy, even if it also risks worsening inflation. Treasury yields fell across the board in response.

The yield on the 10-year Treasury sank to 4.23% from 4.29% late Wednesday.

The moves were even sharper in commodities markets.

Silver’s price dropped 9.8% in its latest wild swing since its record-breaking momentum suddenly halted last week.

Gold’s price fell 1.5% to $4,874.20 per ounce. It’s been careening back and forth since it roughly doubled in price over 12 months. It neared $5,600 last week and then fell below $4,500 on Monday.

Both gold and silver had been screaming higher as investors piled into places they thought would be safer amid worries about political turmoil, a U.S. stock market that critics called expensive and huge debt loads for governments worldwide. But nothing can keep rising at such extreme rates forever, and critics had been calling for a pullback.

Bitcoin, which is pitched as “digital gold,” also sank. It dropped below $69,000, down from its record above $124,000 set in October.

On Wall Street, Qualcomm fell 8.9% even though the chip company topped analysts’ expectations for profit and revenue in the latest quarter. Its forecast for profit in the current quarter fell short of analysts’ expectations as an industrywide shortage of memory pushes some handset makers to cut back on orders.

Outside of tech, Estee Lauder also topped Wall Street targets. It raised its financial forecasts for the full fiscal year, but it also said it expects tariff-related headwinds to wipe out about $100 million worth of profits. The New York cosmetic company’s shares sank 19.9%.

On the winning side of Wall Street were some companies that stand to benefit from big spending by Alphabet and other companies continuing the AI frenzy. Chip company Broadcom rose 2.2% and was the strongest force limiting the S&P 500’s losses.

McKesson jumped 16.3% for the biggest gain in the S&P 500 after reporting stronger profit and revenue for the latest quarter than analysts expected. The health care company also raised its forecasted range for profit this fiscal year.

In stock markets abroad, indexes fell across much of Europe and Asia.

London’s FTSE 100 fell 0.5% after the Bank of England held interest rates there steady. France’s CAC 40 fell 0.5%, and Germany’s DAX lost 0.7% after the European Central Bank likewise stood pat on interest rates.

South Korea’s Kospi tumbled 3.9% for one of the world’s biggest moves and dropped from its all-time high. Samsung Electronics dropped 6%, just two days after it had surged 11.4%.

AP Business Writers Matt Ott and Elaine Kurtenbach contributed.

Trader Robert FInnerty Jr. works on the floor of the New York Stock Exchange, Thursday, Feb. 5, 2026. (AP Photo/Richard Drew)

Trader Joseph Stevens, foreground, works with colleagues on the floor of the New York Stock Exchange, Tuesday, Feb. 3, 2026. (AP Photo/Richard Drew)

Currency traders watch monitors near a screen showing the Korea Composite Stock Price Index (KOSPI), top right, at the foreign exchange dealing room of the Hana Bank headquarters in Seoul, South Korea, Monday, Feb. 2, 2026. (AP Photo/Ahn Young-joon)

A currency traders watches monitors near a screen showing the Korea Composite Stock Price Index (KOSPI), left, at the foreign exchange dealing room of the Hana Bank headquarters in Seoul, South Korea, Monday, Feb. 2, 2026. (AP Photo/Ahn Young-joon)

A board above the trading floor of the New York Stock Exchange displays the closing number for the Dow Jones industrial average, Monday, Feb. 2, 2026. (AP Photo/Richard Drew)

Specialist Anthony Matesic works at his post on the floor of the New York Stock Exchange, Monday, Feb. 2, 2026. (AP Photo/Richard Drew)