The FTSE 100 was on track for an uninspiring end to the week as miners continued their declines on Friday, offsetting gains for London’s most high-profile AI-related stocks.
Positive sentiment emanating from the US after the S&P 500 closed at a record high last nght evaded the FTSE 100 which was down 0.3% at the time of writing.
Experian, Sage and RELX were among the top risers on Friday, enjoying a boost from improving sentiment in software stocks globally on the back of reports that Workday was in takeover talks.
Experian, Sage and RELX were among the UK’s most heavily hit stocks by AI disruption fears that rocked the global software and digital sector earlier this year.
Experian shares were 4.1% higher while Sage rose 3.5%.
Fund managers, including Finsbury Growth & Income’s Nick Train, have maintained their conviction in these stocks throughout the turbulence, and today’s reaction will help validate their views.
In addition, it’s not inconceivable that private equity group’s have their eyes on some of these companies given the reported opportuntistic takeover interest in Workday.
“It’s interesting to note that the top five risers on the FTSE 100 included Sage, Experian and Relx – all united by markets fears earlier this year about how AI could disrupt their respective businesses, which led to share price weakness,” said Dan Coatsworth, head of markets at AJ Bell.
“The fact investors are fishing around these names would suggest there is still decent risk appetite to go bargain hunting. That might also explain why gambling group Entain featured in the top risers, with its shares trading a little over eight times earnings.”
But gains for the FTSE 100 digital names weren’t enough to counteract further declines for mining shares Antofagasta, Rio Tinto, Endeavour Mining and Glencore, which ultimately tipped the index into the red.
Antofagasta was the FTSE 100’s top faller, falling another 4%, as investors rotated out of the stock after the copper miner lowered itss production forecasts yesterday.
Aviva was the FTSE 100’s only major company reporting on Friday, with shares rising 1% after reporting growth across the board and the successful integration of Direct Line.
Mark Crouch, market analyst for etoro, said: “Aviva is wasting little time proving the strategic logic behind its Direct Line acquisition. Operating profit jumped 24% to £1.3 billion, cash remittances surged 47% and general insurance premiums climbed 29%, while Wealth also impressed with net flows up almost a third. The 7% dividend increase adds another reason for shareholders to smile.”