Good morning from the City AM live blog team.
The FTSE 100 is springing back to life this week, managing to seal its second consecutive record close at 9,899.60p after a 1.15 per cent gain and bringing the index a whisker away from the 10,000 mark.
The blue-chip index has rallied after the US government shutdown – which hit a record of over 40 days – looked to be coming to an end.
While in the UK, investors took the news in their stride, Wall Street has struggled against the rising tide of AI fears.
The S&P fell into the red with a 0.3 per cent loss at open, whilst the Nasdaq lost 0.6 per cent. The Dow Jones – which was the outlier – rose 0.2 per cent.
The moves came after chipmaker Nvidia slumped two per cent at open after investment manager SoftBank sold its entire stake in the AI giant for $5bn.
It’s the latest pressure on the ever-ballooning AI bubble, after a string of jitters wiped £750bn of AI-related firms last week.
The UK has fared well against this noise. Despite getting caught up in the broader sell-offs, the FTSE 100’s weighting towards ‘traditional’ stocks such as oil and healthcare has allowed it to curb major losses.
But one lingering threat that could pose a headache to the financial giants on the City’s blue-chip market is the growing unease circling private credit.
The FTSE 100 suffered its worst week since President Donald Trump’s ‘Liberation Day’ tariff onslaught after bank’s led a major sell-off last month when fears of a 2008 financial crisis spooked investors.
Private credit nerves and the inflating AI bubble are continuing to keep global markets on high alert and with it leaving investors to walk the tight-rope.
Here are a few of our top stories from yesterday:
Unemployment rate surges to 5 per cent
UK investors withdraw from equities at record pace
Voters say Rachel Reeves should resign if income taxes are hiked
UK banks send regulation warning as private credit threat rises
Jobs market decline ‘fuels hopes’ for Bank of England interest rate cut