The FTSE 100 climbed to a record high on Wednesday as investors abandoned US and Asian markets amid growing fears of an AI bubble.
The UK’s flagship blue-chip index surged as much as 0.7 percent to reach 10,951.06 points, the highest level recorded since its launch in 1984.
The milestone came as a brutal sell-off swept through global stock markets, triggered by mounting concerns over a slowdown in the AI boom.
Semiconductor stocks on Wall Street, as well as in Japan and South Korea, bore the brunt of heavy selling pressure from nervous investors.
The FTSE 100’s limited exposure to AI and technology stocks meant the index was largely insulated from the panic gripping other major markets around the world.
Neil Birrell, the chief investment officer at Premier Miton, said: “The UK might not be the sexiest of equity markets but it does have its attractions.”
Birrell added: “There are high quality companies in all sectors that compare favourably on valuation to global peers. Boring does have its attractions sometimes.”
Susannah Streeter, the chief investment strategist at Wealth Club, said: “The FTSE 100 is packed with companies with a big stake in the real economy, rather than the future prospects of a world dominated by AI technologies, and right now that’s where more investors are seeking shelter.”
Shell, the index’s second largest company, rose as much as 2.6 percent after Brent crude surged 6 percent to more than $89 per barrel following Saudi Arabia joining the US in launching strikes against Iran.
BP climbed as much as 3.7 percent on the day, adding further momentum to an index dominated by traditional sectors including oil, mining, and defence.
The FTSE 100 last reached a record high in late February, the day before Donald Trump began his war with Iran, before falling more than 9 percent in the early weeks of the conflict.
The index has steadily recovered those losses since then, rising 1.2 percent so far this week in sharp contrast to steep declines on Wall Street and across Asia.
South Korea’s Kospi index triggered a trading circuit breaker on two consecutive days in an attempt to stem its accelerating losses.
The Kospi fell another 6 percent overnight after plummeting 11 percent on Tuesday, as chipmakers Samsung and SK Hynix suffered severe declines that reflected the scale of investor panic.
SK Hynix fell 9 percent on Wednesday despite reporting a sixfold increase in quarterly profits, as doubts over sky-high valuations continued to grow among investors.