London midday: FTSE maintains gains as US bank earnings roll in

(Sharecast News) - London stocks were still in the black by midday on Tuesday as US bank earnings rolled in.

The FTSE 100 was 0.6% firmer at 10,752.26, while Brent crude was down 1.9% at $104.58 a barrel and West Texas Intermediate was 2% lower at $91.83.

The FTSE 100's minimal exposure to the tech sector meant it was able to shrug off a tech-fuelled selloff in Asia, which saw South Korea's Kospi and Japan's Nikkei slide nearly 6% and 2% respectively, as semiconductor stocks sold off heavily.

Dan Coatsworth, head of markets at AJ Bell, said: "Investors are increasingly worried that cracks are starting to show in the AI trade.

"A big sell-off in Asian semiconductor shares including SK Hynix and Samsung Electronics follows comments by Broadcom's chief executive Hock Tan who compared investing in AI to a casino.

"He reportedly said that investors don't really know what they are investing in and have 'very extreme' expectations.

"There are growing fears that companies are investing so much money into AI without a clear idea of the timing or scale of financial payback. High bond yields and expectations for multiple interest rate hikes over the next 12 months also create a challenging backdrop for the growth stocks that populate the AI space, as that negatively affects the present value of future cash flows. A lot of tech valuation is about the jam tomorrow, rather than the jam today.

"The semiconductor industry is known for being highly cyclical, and there is a fear that certain investors have forgotten this important point. Many people think demand will stay strong forever, and they run the risk of being caught out if they are heavily exposed to semiconductor stocks in their portfolio and there is a tech-led market correction.

"It may only take a pack of tech stocks to say that AI demand has eased off to trigger a market pullback. It highlights the importance of having a diversified portfolio and not being overly exposed to one area."

On home shores, figures from Worldpanel by Numerator showed that grocery inflation ticked higher in the four weeks to 4 October, as shoppers sought autumn staples,

Like-for-like grocery inflation increased to 2.5%, from 2.3% in the previous four-week period, with prices rising fastest in markets such as water and squash, skincare and skin cleansing. Prices fell fastest in butters and spreads, chocolate and cheese.

Fraser McKevitt, head of retail and consumer insight at Worldpanel by Numerator, said: "With the Autumn Budget fast approaching, the cost of living continues to weigh heavily on the minds of shoppers. And the cost of filling up a car is only adding to the pressure on household budgets. More than half tell us they're very or extremely worried about petrol prices, and almost one in three say it's already taking a real toll on their finances. Until the Chancellor sets out his plans, we expect that caution to carry on showing up at the till, with shoppers leaning more heavily on promotions to keep their grocery spend under control.

"With spending on promotions in the last month up by more than a quarter of a billion pounds compared with last year, special offers remain a key tool for shoppers looking to keep their grocery bills in check, or to make pricier items and larger packs more affordable."

Separate data showed that retail sales growth eased in September as consumers remained cautious ahead of expected rises in household bills and taxes.

The latest BRC-KPMG retail sales monitor showed that total retail sales rose 1.3% year-on-year last month, down from 2.3% growth in September 2025 and coming in below 12-month average growth of 1.5%.

Investors were also mulling quarterly results from US banking giants JPMorgan and Wells Fargo across the pond.

In UK equity markets, Melrose shot to the top of the FTSE 100 as it said its GKN Aerospace unit had reached a $125m settlement with authorities in California relating to a chemical incident in May and that it continues to expect a phased return to full capacity at the site during the fourth quarter.

NatWest was a high riser after Barclays upgraded the shares to 'overweight' from 'equalweight' and lifted the price target to 850p from 740p.

Premier Inn owner Whitbread gained after it reported a fall in first-half profit as it took a hit from costs associated with its strategic review and 'Accelerating Growth Plan', but backed its outlook for the year.

BP was also on the rise after a third-quarter trading statement, while housebuilder Bellway edged up as it reported a 5.7% increase in full-year underlying pre-tax profit and announced a £150m share buyback.

On the downside, Michael Page reversed earlier gains to trade lower even as it the recruiter backed its full-year expectations and said it returned to growth in the third quarter thanks to strong performances from the Americas and Asia Pacific.

Bytes Technology and Transact owner IntegraFin fell after results and a trading update, respectively.

Market Movers

FTSE 100 (UKX) 10,723.60 0.63%

FTSE 250 (MCX) 24,380.05 0.21%

techMARK (TASX) 6,227.22 0.84%

FTSE 100 - Risers

Melrose Industries (MRO) 468.80p 4.20%

NATWEST GROUP (NWG) 669.80p 2.73%

Whitbread (WTB) 2,566.00p 2.39%

Airtel Africa (AAF) 296.20p 2.28%

Diageo (DGE) 1,710.00p 2.21%

Croda International (CRDA) 3,491.00p 2.19%

British Land Company (BLND) 401.20p 2.04%

AstraZeneca (AZN) 12,262.00p 1.90%

Barratt Redrow (BTRW) 294.40p 1.87%

JD Sports Fashion (JD.) 87.20p 1.82%

FTSE 100 - Fallers

Antofagasta (ANTO) 3,750.00p -1.24%

IMI (IMI) 3,076.00p -1.09%

Balfour Beatty (BBY) 866.50p -1.02%

Rolls-Royce Holdings (RR.) 1,382.00p -0.97%

Sainsbury (J) (SBRY) 335.40p -0.83%

St James's Place (STJ) 1,034.00p -0.82%

Informa (INF) 876.60p -0.75%

Rio Tinto (RIO) 7,101.00p -0.59%

Burberry Group (BRBY) 1,037.00p -0.57%

Rentokil Initial (RTO) 304.40p -0.52%

FTSE 250 - Risers

Rank Group (RNK) 73.10p 4.67%

Young & Co's Brewery 'A' Shares (YNGA) 1,028.00p 3.41%

Vistry Group (VTY) 225.20p 2.73%

Great Portland Estates (GPE) 313.60p 2.69%

Helios Towers (HTWS) 227.00p 2.53%

Travis Perkins (TPK) 573.50p 2.41%

Pan African Resources (PAF) 120.60p 2.20%

Workspace Group (WKP) 358.40p 2.17%

Victrex plc (VCT) 946.00p 2.16%

Avon Technologies (AVON) 2,370.00p 2.16%

FTSE 250 - Fallers

Michael Page (PAGE) 184.60p -5.77%

Bytes Technology Group (BYIT) 437.80p -5.28%

Hays (HAS) 54.15p -4.33%

Ocado Group (OCDO) 291.40p -3.46%

IntegraFin Holding (IHP) 372.50p -2.99%

Globaldata (DATA) 61.45p -2.69%

Pacific Horizon Inv Trust (PHI) 1,076.00p -2.54%

Fidelity Emerging Markets Limited Ptg NPV (FEML) 1,488.00p -1.98%

Templeton Emerging Markets Inv Trust (TEM) 323.50p -1.97%

Polar Capital Technology Trust (PCT) 680.00p -1.88%