FTSE 100 Falls 1.5% to 10,625.40 as AI Stock Sell-Off Widens

Key Facts

The UK's FTSE 100 fell 1.5% to 10,625.40 points during trading on Friday, November 6, 2026, as a sell-off in AI-related stocks spread across global markets, according to the Associated Press. London's decline followed sharp losses on Wall Street in the previous session, while concerns about AI company valuations and the spending needed to build computing capacity and data centers weighed on investor sentiment. Reuters said the technology sell-off had erased nearly $3 trillion from the market value of S&P 500 companies through Friday. The agency also linked the concern to expectations of tighter US oversight of the sector. Against this backdrop, the British index's losses reflected pressure spreading to major markets outside the United States.

The decline on Wall Street on Thursday, November 5, was broad across major indexes, with the S&P 500 falling 4.4% in its worst session since the market turmoil linked to tariffs in April 2025, according to the Associated Press. The Dow Jones Industrial Average fell 1,833 points, or 3.4%, while the Nasdaq Composite dropped 5.5%. The Nasdaq entered correction territory after falling 11.9% from the record high it reached the previous month. Reuters estimated that Thursday's losses erased about $2 trillion from the Nasdaq's market value. These figures show the severity of the sell-off ahead of London trading, while sources did not attribute the move in any individual UK stock to a specific factor.

The Associated Press said critics believe AI stock prices have risen to excessive levels, amid concerns about a bubble and the borrowing and spending tied to expanding the sector's infrastructure. The agency added that the possibility of tighter regulation after the US midterm elections was among the factors that heightened concern. On data center-related concerns, Reuters said states that could restrict their development account for about 45% of planned US capacity, while Texas accounts for about 25%, according to Goldman Sachs estimates. A Reuters report quoted JPMorgan analysts as saying most of those states had not imposed a complete ban, but new projects could face higher approval thresholds. The analysts said this could give projects that have secured approvals a significant advantage.

Losses spread to Asia and Europe in Friday's session. Japan's Nikkei closed down 6.0% at 57,434.77 points, and South Korea's Kospi fell 6.0% to 5,059.69 points, according to the Associated Press. In early European trading, France's CAC 40 fell 1.2% to 8,107.20 points, while Germany's DAX dropped 1.4% to 25,961.60 points. US futures moved differently from some cash indexes, with Nasdaq 100 futures up 1.48% at 4:14 a.m. Eastern Time on Friday, according to Reuters. The gains followed the sharp sell-off, while European and Asian indexes remained under pressure. The moves show a divergence between US futures and markets that were already trading or had closed.

At the company level, Qualcomm shares fell 9.5% on Thursday after fourth-quarter handset chip sales came in below Wall Street estimates, according to Reuters. The stock's decline highlighted chipmakers' sensitivity to demand expectations, as broader concerns focused on the spending and financing needed to build AI infrastructure. On data centers, the Associated Press said OpenAI published a framework on Thursday that included commitments to communities where it develops data centers. The company urged policymakers to set clear rules for building out the sector. This places the regulatory debate alongside the financing and spending considerations cited by sources as part of the backdrop to the sell-off.

In the UK, the Bank of England approved a 0.25 percentage point interest rate increase to 4% in a decision announced on November 5, after a meeting that ended on November 4. The Monetary Policy Committee voted 8 to 1 in favor of the increase, while the dissenting member preferred a 0.5 percentage point rise to 4.25%. The bank's decision does not establish that it caused UK stocks to fall on Friday, but it sets the backdrop for domestic borrowing costs amid the global sell-off. In housing data, Lloyds said the average house price was £296,285 in October, down 0.6% from the previous month and 1.2% from a year earlier. The bank described the annual decline as the largest since October 2023.

Lloyds said renewed inflationary pressures, driven in part by conflict in the Middle East, are keeping borrowing costs high and adding pressure to household budgets, making some buyers more cautious. The bank cited these pressures in its discussion of the housing data without attributing the FTSE 100's move to them. In the United States, Reuters listed October nonfarm payrolls data among the events due on Friday. The Bank of England also set December 17, 2026, as the date of the Monetary Policy Committee's next decision, while Lloyds said its November house price index update would be released on December 7, 2026. Ipek Ozkardeskaya, senior analyst at Swissquote, said the sell-off could offer an opportunity to buy companies at discounted prices. She said, "The sell-off in companies that have long captured investors' appetite could create opportunities to buy at discounted prices."