London’s FTSE 100 closed at a three-month high on Friday, as gains among insurers, energy companies and consumer-focused businesses helped Britain’s blue-chip index withstand another sell-off in US technology stocks.
The FTSE 100 gained 39.47 points, or 0.4%, to finish at 10,902.56, extending its recent recovery and recording a 2.2% advance for the week. The performance contrasted with the FTSE 250, which fell 111.43 points, or 0.5%, to 24,805.41, while the AIM All-Share edged 0.1% higher to 757.19.
Despite Friday’s mixed performance, the FTSE 250 gained 1.2% over the week, while the AIM All-Share recorded a smaller weekly increase.
Investors continued rotating towards defensive sectors as uncertainty surrounding artificial intelligence companies weighed on Wall Street.
Around the London close, the Nasdaq Composite was down 1.4%, the S&P 500 had fallen 0.8% and the Dow Jones Industrial Average was 0.2% lower.
Technology shares experienced another difficult session as investors reassessed the outlook for AI infrastructure investment, corporate valuations and leadership changes at Nvidia.
Nvidia declined a further 3.4%, extending recent losses following the departure of co-founder and Chief Executive Jensen Huang.
Other semiconductor companies also came under pressure, with Advanced Micro Devices falling approximately 10%, Broadcom declining 6.1%, Intel losing 5% and Micron Technology dropping 4.6%.
The weakness spread to London-listed technology investment companies, where Polar Capital Technology Trust fell 3.4% to 571.50p, while Scottish Mortgage Investment Trust declined 1.6%.
Trade Nation analyst David Morrison highlighted Nvidia’s central role in the AI investment cycle, noting its importance in supplying processors for data centres and supporting the businesses developing AI infrastructure.
He suggested that the company’s recent share-price decline reflected wider concerns about whether the enormous capital expenditure associated with artificial intelligence would generate sufficient financial returns.
Investor attention is also turning towards Anthropic’s forthcoming initial public offering, which is expected to provide an important test of demand for AI-related investments.
The developer of the Claude artificial intelligence models has outlined plans to offer 825 million Class A shares at an indicative price of $70 to $78 each.
At the upper end of that range, the public offering would have a gross value of approximately $64.4 billion, including shares being sold by existing shareholders.
Separately, Anthropic has arranged a $26 billion private placement involving major technology companies, bringing the combined transaction value to approximately $90.4 billion, before any additional underwriter allotment.
Reports suggest the offering has attracted demand several times greater than the number of shares available, although final pricing and allocations have yet to be confirmed.
Microsoft recovered from earlier losses to trade approximately 0.1% higher, despite continued disruption associated with a major global outage affecting Outlook, Teams and other Microsoft 365 applications.
The company said its infrastructure recovery efforts were producing positive results and indicated that the disruption was not caused by malicious activity.
The outage affected businesses, government organisations and individual users across multiple countries, highlighting the dependence of essential operations on cloud-based services.
US inflation remained another important market influence, following the release of October producer price figures.
The producer price index increased 0.3% month-on-month, below forecasts of 0.4% and substantially slower than September’s 1.4% increase.
However, annual producer price inflation accelerated to 6.5% from 6.3%, reaching its highest level since November 2022.
Core producer prices, excluding food and energy, rose 0.3% during October, while the annual core rate remained at 5%.
Barclays economist Pooja Sriram said the figures continued to indicate underlying price pressures, despite the moderation in monthly headline inflation.
The data reinforced expectations that the Federal Reserve could increase interest rates again in December.
The US dollar strengthened further, with sterling easing to $1.3219 from $1.3233 on Thursday.
The euro slipped to $1.1031, while the benchmark US 10-year Treasury yield rose to 5.13%, compared with 5.08% in the previous session.
Higher bond yields continued to influence equity valuations, particularly among technology companies whose investment cases depend heavily on future earnings growth.
In London, Aviva was among the FTSE 100’s strongest performers, gaining 3.4% to 764.80p after reporting continued growth in its insurance and wealth management businesses.
The company reiterated confidence in meeting its medium-term financial objectives, supported by higher general insurance premiums and increased wealth net inflows.
Centrica also performed strongly, climbing to 160.65p, while Associated British Foods, Auto Trader and J Sainsbury were among the other leading blue-chip gainers.
Wise advanced 7.8% following stronger half-year revenue and profit, supported by continued growth in its international payments business.
The company reported an increase in active customers and cross-border transaction volumes, reinforcing confidence in its underlying growth prospects.
Asos gained 2.9% after Peel Hunt upgraded the online fashion retailer to buy from add and raised its share price target to 560p.
However, WH Smith declined 6.1%, extending losses following its annual results, while Dr Martens fell a further 2.6% after reporting weaker trading earlier in the week.
In commodities, Brent crude rose to $96.59 a barrel, compared with $93.53 on Thursday, while gold strengthened modestly to $3,878.82 an ounce.
European equity markets were mixed, with France’s CAC 40 gaining 0.1% and Germany’s DAX declining 0.1%.
Eurozone economic figures showed that GDP growth slowed to 0.4% in the third quarter, compared with 0.6% in the preceding three months.
The FTSE 100’s rise above 10,900 provided a positive conclusion to a volatile week, with gains in insurers, utilities and consumer-facing companies helping offset weakness among technology-related investments.
The index’s 2.2% weekly advance reflected a degree of resilience in London’s market despite renewed volatility across global equities.
Investors will now turn to Monday’s economic releases from China, Japan and Canada, including Chinese industrial production and retail sales, Japanese GDP and Canadian inflation figures.
In London, Big Yellow Group is scheduled to publish half-year results, while Legal & General will issue a trading update.
The FTSE 100’s three-month closing high highlights the contrast between the relative strength of selected UK defensive stocks and the renewed uncertainty surrounding the global artificial intelligence investment cycle.
