London close: Stocks erase early gains after Wall Street sell-off

5th Nov 2026 15:09

(Sharecast News) - UK stocks gave up earlier gains by the close of play on Thursday as a rough start on Wall Street hammered market sentiment, while investors reacted to the Bank of England's first rate in three years.

The FTSE 100 was on track to set a new record, jumping over 1% early to hit an intraday high of 10,948.24 and surpassing the previous closing high of 10,910.55 set in February. However, a mass sell-off of AI and chip stocks in New York after the closing bell pulled the UK benchmark index down 0.4% to settle at 10,782.66.

The S&P 500 and Nasdaq were both trading at their lowest levels since late-July, falling 2.8% and 3.9% respectively, as the post-midterm election rally quickly faded. Heightened concerns that the Democrats' sweeping victory in Washington could lead to greater scrutiny of AI infrastructure spending and data centre development weighed heavily on companies in the AI and chip sectors.

"We are seeing a complete capitulation-level event in tech stocks today. Looks like total degrossing and some leveraged funds may well be blowing up. The blood is in the streets, folks," said Neil Wilson, UK investor strategist at Saxo.

"The fear is a total momentum unwind as Democrats pace the frontier and kybosh data centre buildout... this looks totally overdone, but the nature of sell-everything of this market means we need to look for some stability first."

On home shores, the Bank of England's Monetary Policy Committee voted by a majority of 8-to-1 to hike Bank Rate by 25 basis points to 4%, in the wake of mounting inflation, as widely expected. Catherine Mann was the lone dissenting voice, arguing instead for a steeper 50bp hike.

At the start of 2026, the BoE had been widely expected to cut rates throughout the year. But the outbreak of war in the Middle East in early spring threw global energy markets into turmoil and has sent inflationary pressures climbing once more. In the accompanying statement, the MPC noted that CPI was set to rise to "around 5%" by the middle of next year before falling back as annual energy price inflation fades.

"The question now is where the committee goes from here," said the Confederation of British Industry in a statement. "Persistently high inflation means another rate rise cannot be ruled out. That could prove challenging, with interest rates already weighing on economy activity, while tighter financial conditions are doing some of the BoE's work for it."

It continued: "Either way, households and businesses face higher borrowing costs in the near term. That's a bitter pill to swallow."

In equity movements, shares in Coca-Cola HBC tanked 18% in afternoon trade despite the bottling company issuing a positive trading update on Wednesday, in which it upgraded its full-year revenue guidance. Barclays on Thursday cut its target price for the stock from 5,500p to 5,300p, though kept an 'overweight' rating with significant upside still expected.

BT Group surged early on but finished flat as it maintained full-year guidance andreported higher revenues and profits for the first half, alongside a reduction in its pension deficit.

Diageo shares were higher after the drinks giant reiterated its full-year outlook despite ongoing softness in North America. Updating on trading, the owner of Guinness and Smirnoff said first-quarter net sales rose 1.4% on an organic basis to $4.93bn.

National Grid shares rose after the energy infrastructure group reported a sharp increase in first-half profits and upgraded its full-year earnings guidance, supported by higher regulated revenues and record investment in its networks.

Next edged up as third-quarter sales at the fashion and homeware retailer beat expectations, driven by the international operations, although UK growth was volatile after the hot summer weather that deterred shoppers from venturing out.

Defence firms BAE Systems and Babcock lost ground again, having fallen on Wednesday amid expectations the Democrats' mid-terms victory would lead to lower defence spending.

Meanwhile, miners Endeavour Mining and Fresnillo gained as precious metal prices rose.

Market Movers

FTSE 100 (UKX) 10,782.66 -0.43%

FTSE 250 (MCX) 24,701.98 -0.86%

techMARK (TASX) 6,230.07 -1.50%

FTSE 100 - Risers

Airtel Africa (AAF) 289.20p 3.80%

Diageo (DGE) 1,871.50p 3.20%

Imperial Brands (IMB) 3,062.00p 2.82%

Next (NXT) 15,990.00p 2.47%

Admiral Group (ADM) 4,056.00p 2.42%

InterContinental Hotels Group (IHG) 176.95p 2.19%

Bunzl (BNZL) 2,924.00p 1.95%

Fresnillo (FRES) 2,495.00p 1.92%

National Grid (NG.) 1,285.50p 1.62%

British American Tobacco (BATS) 4,717.00p 1.57%

FTSE 100 - Fallers

Coca-Cola HBC AG (CDI) (CCH) 4,052.00p -17.88%

Metlen Energy & Metals (MTLN) 44.56p -8.84%

BAE Systems (BA.) 1,880.50p -5.41%

Scottish Mortgage Inv Trust (SMT) 1,434.00p -4.81%

Computacenter (CCC) 4,598.00p -4.68%

Prudential (PRU) 928.20p -3.83%

Antofagasta (ANTO) 3,125.00p -3.79%

Pershing Square Holdings Ltd NPV (PSH) 3,850.00p -3.65%

Halma (HLMA) 3,314.00p -3.61%

NATWEST GROUP (NWG) 593.20p -3.31%

FTSE 250 - Risers

Endeavour Mining (EDV) 4,013.00p 6.22%

Frasers Group (FRAS) 958.00p 5.27%

Amaroq Ltd. Npv (DI) (AMRQ) 104.00p 4.63%

Hochschild Mining (HOC) 480.60p 4.16%

Morgan Sindall Group (MGNS) 4,310.00p 4.11%

RS Group (RS1) 788.00p 3.68%

Travis Perkins (TPK) 664.00p 3.11%

Helios Towers (HTWS) 219.80p 2.90%

Morgan Advanced Materials (MGAM) 266.00p 2.70%

OSB Group (OSB) 510.00p 2.57%

FTSE 250 - Fallers

Ashmore Group (ASHM) 208.80p -8.90%

Fidelity Emerging Markets Limited Ptg NPV (FEML) 1,164.00p -7.18%

Allianz Technology Trust (ATT) 602.00p -7.10%

Oxford Instruments (OXIG) 2,368.00p -6.70%

Polar Capital Technology Trust (PCT) 543.00p -6.62%

Vistry Group (VTY) 273.00p -5.86%

Ceres Power Holdings (CWR) 266.60p -5.86%

Keller Group (KLR) 2,998.00p -5.49%

Herald Investment Trust (HRI) 2,590.00p -5.13%

Schroder Asia Pacific Fund (SDP) 716.00p -5.04%