The FTSE 100 soared on Thursday as the Bank of England cut interest rates and signalled further rate cuts in the near-term, helping propel the index to fresh record highs.

London’s leading index stormed higher in early trade as investors front-run the decision to cut rates by 0.25% and extended gains after the release. The FTSE 100 was trading at 8,750 at the time of writing and was likely to remain choppy as the session progressed.

The cyclical sectors were among the top risers, with miners surging higher alongside financials. Overseas revenue earners were also among those companies gaining as the inverse relationship between the FTSE 100 and the pound kicked in.

“A weaker pound against the US dollar benefits companies which earn some or all of their money in the American currency, hence why we saw miners, gambling group Entain, construction rental firm Ashtead and ratcatcher Rentokil get a boost,” said Russ Mould, investment director at AJ Bell.

The Bank of England has fired up equity bulls by signalling to the market they can expect additional rate cuts before long.

In a signal of what the Bank of England may do in the future, seven of the nine MPC voting members voted for a 0.25% cut, while two voted for a 0.5% cut.

The country is on the verge of stagflation and must choose between controlling inflation and supporting the economy. 

The BoE’s core mandate is to keep inflation at its target rate of 2%. However, they are also responsible for price stability, which is threatened by the economic outlook.

A risk for the Bank of England is that by not cutting rates now, growth will suffer, and they may end up with the problem of inflation below 2% down the road as the economy slows further and jobs are lost.

This would have consequences for financial markets, leading to volatility in equity and bond markets. 

“Looking longer term, there is still work to be done to find the ‘neutral’ level for rates where the UK economy can deliver price stability,” said Brad Holland, director of investment strategy at Nutmeg.

“As a result, the committee remains in monitoring mode, assessing the impact of rate cuts on growth and how recent measures taken in the Autumn Budget could impact inflation.”

The bank’s job has been made that much harder by the government’s economic policies that are threatening to slow the pace of hiring when the changes to national insurance come into play.

In effect, today’s decision to cut rates by 0.25% is a move to bail out Rachel Reeves. 

Nonetheless, it is a welcome move for the UK economy, which should help spur activity.

Housebuilding shares soared after the interest rate cut announcement and joined the ranks of the already well-bid miners and overseas earners. Taylor Wimpey jumped 3%, and Persimmon added 2.5%.

Gfinity shares soared this week after the digital media company signed an exclusive licencing agreement with 0M Technology Solutions to commercialise a digital marketing technology, Connected IQ, targeted at the Connected TV market.

The company also raised £245,000 to fund the commercial rollout of the service, which will utilise AI to help improve the targeting of adverts across video formats.

“The funding allows us to continue our push into sectors which we think are exciting for the Company, namely Connected TV, Online Video and Artificial Intelligence,” said David Halley, CEO of Gfinity.

“In addition, through our commercialisation of CIQ, we will gain an experienced team of Data and AI specialists to support our development.”

Gfinity shares were up over 100% at one point on the day of the announcement. They could have further to run.

There are similarities between Gfinity and GenIP – a company we included in our Top 20 stock picks for 2025 – in that the companies have clear applications of AI that fix real-world problems. 

Their respective real-world problems are very different in that GenIP is providing solutions in the research organisation technology transfer space while Gfinity is setting its sights on video advertising. 

However, underpinning the investment case for both companies, there is a material underlying demand for their services, irrespective of the efficiencies created by AI.

Of course, Gfinity is a long way behind GenIP. Gfinity has only just licensed the technology. By their own admission, Gfinity knows it may not gain any real traction. But that doesn’t make it any less exciting.

Contextual advertising

The underlying problem for advertisers is privacy rules have diminished their ability to target specific audiences. Advertisers using networks like Google and Meta that relied on cookies to track activity about audiences based on their activity have had to rethink their approach. This has given rise to contextual advertising that focuses on placing adverts in settings their audience may visit.

Instead of chasing potential customers around the internet by targeting ads based on demographics and behaviour data provided by advertising platforms, advertisers are increasingly seeking out contextual placements, knowing their audience will likely visit that setting.

A review of Connected IQ’s website suggests they are setting out to improve the methodology involved in gauging the relevance of videos (or context) to advertise around.

The Connected TV advertising industry isn’t anything new. Serving video content to consumers with tailored and targeted ads has been around for years. There are many established players with slightly different services and approaches to the market. 

There is no longer a first-mover advantage in Connected TV. There is, however, an opportunity to disrupt the existing market with a solution powered by AI that produces better results for advertisers. 

The UK is home to a thriving advertising technology industry with dozens upon dozens of success stories. A good product will attract clients.

A word of caution: OM Technology is a new company that has yet to file first-year accounts, so the market has little information to gauge its success so far and whether there is any interest from the industry.

Director and shareholder stakebuilding

The involvement of Robert Keith is certainly interesting. The businessman has been increasing his stake in the company and clearly had a strategy to turn the ailing e-sports group around.

Gfinity’s technology is licensed from a company that Robert Keith controls. The way the deal and the licensing agreement have been structured is notable because it allows Gfinity to take the AI Connected TV technology to market without a significant capital outlay by Gfinity to develop the technology.

Investors will also note CEO David Halley has consistently increased his stake in the company since his appointment. This is highly encouraging.

One shouldn’t forget that Gfinity still has the revenue-generating media business. The restructuring of the business to strip out costs means this could actually be profitable this year.

Gfinity’s recent rally means that it is no longer priced to delist or go into administration. However, the current £2m market cap doesn’t reflect the opportunity for the launch of the new business or the long-awaited profitability of its esports media business.

Gfinity has announced two significant developments: the acquisition of an exclusive license for advanced artificial intelligence technology and a successful fundraising round.

Shares spiked over 40% higher on Wednesday as a result.

The company has entered into an exclusive licensing agreement with 0M Technology Solutions Ltd for their Connected IQ (CIQ) technology, which specialises in contextual connected video advertising.

Under the terms of the agreement signed on February 4, 2025, Gfinity will pay a royalty fee of 30% of net profits generated from the license.

Connected IQ offers advertisers improved contextual video marketing opportunities powered by machine learning to enhance the relevance of the videos with which adverts are associated. Contextual advertising is growing in popularity amid increasing privacy laws that diminish the targeting of specific audiences on advertising networks.

Alongside the strategic move into the AI video arena, Gfinity has raised £245,000 through a subscription with third parties at 0.0625 pence per share. Additionally, Director David Halley has indicated his intention to subscribe for £15,000 worth of shares at the same price, bringing the total fundraising to £260,000 before expenses.

“The funding allows us to continue our push into sectors which we think are exciting for the Company, namely Connected TV, Online Video and Artificial Intelligence,” said David Halley, CEO of Gfinity.

“In addition, through our commercialisation of CIQ, we will gain an experienced team of Data and AI specialists to support our development.”

The company plans to leverage its existing advertising sector network and digital media monetisation expertise alongside CIQ’s established relationships with top-tier agencies and sell-side platforms. However, investors should note that CIQ is still in its early stages with a limited sales track record, and 0M Technology Solutions is a newly formed company with no published accounts.

The FTSE 100 was broadly flat on Wednesday as traders gathered their thoughts after the US president launched a trade war against some of the USA’s closest trading partners.

Despite Donald Trump agreeing to a 30-day delay in tariffs on Mexican and Canadian goods, financial markets remain vulnerable to any further developments in the tariffs spat, with traders wary of his next move. 

“A sense of calm returned to markets after the tariff-related tantrum. Wall Street recorded decent gains last night while Europe held firm this morning,” said Russ Mould, investment director at AJ Bell.

“The elephant in the room remains China as Donald Trump has not backed down from a trade spat. Retaliation is underway and that’s led to the cancellation of a meeting between the two country leaders.

“The decision by the US Postal Service to stop accepting parcels from mainland China and Hong Kong shows the severity of the matter. That’s disastrous for big Chinese e-commerce platforms that send goods to the US including Shein and PDD-owned Temu.”

Although the volatility has subsided, the unpredictability of Trump’s economic policy will have markets on the edge of their seats for the foreseeable future. This will likely lead to markets trading headline to headline until significant monetary policy developments take centre stage again.

The FTSE 100 was down 0.1% at the time of writing, with positive corporate updates helping to provide some support for the index. 

GSK shares shot to the top of the FTSE 100 leaderboard after announcing a sharp increase in oncology drug sales that helped group sales rise 7% on a constant exchange rate basis.

Investors will be delighted with the 6% jump in GSK shares on Wednesday after a fairly torrid 2024 for the stock. 

“GSK’s latest earnings update brings some welcome relief for investors. After falling 20% since May, GlaxoSmithKline’s shares have struggled, weighed down by legal and political challenges that have lingered like a stubborn cold,” said Mark Crouch, market analyst at investment platform eToro.

“However, following a better-than-expected fourth-quarter, Glaxo now projects sales to grow by up to 5% in 2025. Strength in its HIV and oncology portfolios has been a key driver, offsetting weaknesses in vaccine sales as GSK generated £3 billion in free cash flow.”

Frenillo jumped 3% to 741p after JP Morgan hiked its price target to 1,000p.

BP and Shell were slightly bid despite oil prices falling again amid Trump’s trade war, which threatened to disrupt both the demand and supply sides of the crude market.

“Crude oil futures remained under pressure after a turbulent session, as traders reacted to rising U.S. stockpiles and escalating Sino-U.S. trade tensions,” said Joseph Dahrieh, Managing Principal at Tickmill.

“China’s tariffs add uncertainty and their broader impact on the global supply and demand of energy products could fuel some risks. Prices initially dipped after China imposed tariffs on U.S. energy imports but later rebounded when President Trump reaffirmed his strategy to apply maximum pressure on Iran, aiming to curb its crude exports. With sanctions potentially removing up to 1.5 million barrels per day from global supply, the market found some support.”

SSE shares were fairly flat after announcing a 26% in renewables output so far in their financial year and confirmed adjusted earnings per share would be similar to the last two years.