The FTSE 100’s resilience towards the end of last week evaporated on Monday as investor woes weighed on London’s leading index.
Having surged over 400 points in five trading sessions to close last week at 10,881, it was London’s turn to feel some of the pain experienced in other major equity indices on Monday.
The FTSE 100 was down 0.9% at the time of writing after US technology shares sank on Friday and interest-rate concerns persisted.
“European markets faced a tricky start on Monday as the political unrest in France shows little sign of letting up and as AI and geopolitical concerns continue to weigh,” said AJ Bell investment director Russ Mould.
“The sell-off in US tech seen late Friday on concerns about the big debt being built up as companies spend heavily on AI has cast a shadow over the start of the week for financial markets.
“France apart, government bond yields are stable, and oil prices have pulled back from recent highs, but both remain elevated to reflect the ongoing uncertainty around Ukraine and the Middle East.”
It must be noted that AI names were rallying in the US pre-market, which could follow through to a recovery for London later in the session.
Although the FTSE 100 fell sharply on Monday, most stocks avoided a major slide, with several names in the mining and banking sectors among the heaviest hit.
Miner Anglo American, down 3.9%, was the top faller as investors offloaded higher-beat, higher-risk shares. Peer Antofagasta was down 1.8%.
Barclays was the second-worst performer after news that the Bank of England was investigating whether the bank had underreported the risk in its private credit business. Shares were down 3%.
There were few gainers on Monday, with Sage Group and RELX among the top risers as investors continued to reallocate to those companies struck down AI disruption fears earlier in the year.
BP added another 0.9% as it extended gains above 610p. BP shares are 42% higher year-to-date.