'Anti-Tech' Becomes Strongest Brand: This Country's Stock Market Reaches New High Amid Global Downturn

Amid a global sell-off in semiconductor stocks and a sharp correction in AI-related equities, the UK stock market has leveraged its structural advantage—low technology exposure and high weighting in financial and energy sectors—to become a new safe haven for international capital. The benchmark FTSE 100 index (FTSE) reached a new all-time high on Wednesday (29th).

During Wednesday’s trading session, the FTSE 100 rose over 0.7%, peaking at 10,951.06 points, surpassing its previous record of 10,934.94 points set in late February. Although gains later narrowed, the index maintained an upward trend, demonstrating strong resilience compared to other major global markets.

The rise of the FTSE 100 comes amid heavy selling pressure on global tech stocks. Investors have been reducing their holdings in semiconductor and memory-related stocks, pushing the Nasdaq 100 index into technical correction territory.

As volatility intensifies in AI supply chains and chip-related equities, capital is shifting from high-valuation tech stocks toward defensive and value-oriented assets. The UK market has become one of the primary beneficiaries of this rotation.

Emmanuel Cau, Barclays’ European equity strategy head, noted that the FTSE 100 is practically an 'anti-tech' index. With markets actively seeking counter-cyclical, anti-tech portfolio allocations amid rising volatility, the UK market has become a relatively ideal capital refuge.

Dan Hanbury, equity portfolio manager at Ninety One, said the global investment landscape is expanding, with capital gradually exiting tech giants. As a result, he has increased his allocation to UK equities within his global portfolio.

He believes UK large-cap companies remain relatively undervalued and benefit from exposure to cyclical industries like oil and gas, as well as numerous defensive businesses—making them more attractive under current market conditions.

Data also reflects this capital rotation trend. So far this month, the FTSE 100 has gained nearly 4%, while the S&P 500 has fallen about 2% and the Nasdaq has dropped over 6%, clearly indicating a shift of capital from tech stocks to traditional industries.

Beyond sectoral advantages, energy stocks have also been a key pillar supporting the UK market. After the FTSE 100 last hit a record high at the end of February, geopolitical tensions in the Middle East escalated, briefly pushing up international energy prices.

For the UK market, which has a high concentration of energy firms, this proved beneficial. Since the conflict began, Shell and BP shares have risen approximately 7% and 13% respectively, becoming major contributors to the index’s rise.

Banking stocks have also led the rally. HSBC, Lloyds Bank, Standard Chartered, NatWest, and Barclays have all ranked among the top-performing stocks in the FTSE 100 this year.

Markets believe that with corporate earnings remaining robust and rising energy prices pushing up global borrowing costs, banks’ profitability continues to improve—further supporting UK market performance.

Roland Kaloyan, Societe Generale’s European equity strategy head, pointed out that the FTSE 100’s low exposure to consumer discretionary sectors—especially automotive and luxury goods—has given it better downside resilience in recent European market conditions.

Year-to-date, the FTSE 100 has risen 9.5%, slightly outperforming the pan-European Stoxx 600’s 9% gain.

Looking ahead, multiple institutions maintain an optimistic outlook. Max Kettner, HSBC’s chief cross-asset strategist, said the true driver behind the rise of UK and European equities remains bank stocks. With expectations for continued improvement in corporate earnings, European markets are likely to maintain relative strength.

Ruffer Investment Company believes that as the UK economy gradually improves and market sentiment toward UK assets remains overly pessimistic, a future rate cut could benefit interest-sensitive sectors like residential construction—further supporting London’s stock market performance.