The FTSE 100 closed lower on Tuesday as a rally in mining stocks was offset by sharp falls in software, data analytics and advertising companies amid perceived threats from AI.
The FTSE 100 index closed down 26.97 points, or 0.3%, at 10,314.59.
The FTSE 250 closed down 135.68 points, or 0.6%, at 23,290.37, and the AIM All-Share closed up 3.99 points, or 0.5%, at 818.33.
On the FTSE 100, Relx fell 14%, London Stock Exchange Group fell 13%, Experian fell 8.3%, Sage Group fell 6.5% and Pearson fell 7.7%.
The sharp declines came after US artificial intelligence firm Anthropic launched new 'agent AI' tools for corporate legal teams, including a legal add-on for its Claude generative AI chatbot.
The American artificial intelligence company said the tool can automate legal work, such as reviewing contracts, sorting confidentiality agreements, writing reports and providing template-based responses.
The deployment renewed fears that AI will threaten existing business models, hurting sales and growth.
Relx owns LexisNexis, a provider of information and analytics for law firms, while the London Stock Exchange is a provider of financial data.
Experian is a credit checker, Pearson is a provider of educational content and assessments, while Sage sells accounting software.
In Europe, Dutch publisher Wolters Kluwer fell 13%, while losses spread to the world of advertising, where WPP fell 8.7%, and Publicis, which also published its fourth-quarter results, fell 8.9% in Paris.
In the United States, data provider Thomson Reuters fell 16%.
In European equities on Tuesday, the CAC 40 in Paris closed slightly lower, while the DAX 40 in Frankfurt fell 0.1%.
Mining stocks rose in London, rebounding after recent falls.
Gold rose to $4,971.16 an ounce on Tuesday, up from $4,696.11 at the same time on Monday.
Silver rallied 12% and copper strengthened 4.5%.
The five companies that rose the most were mining companies, with Anglo American rising 7.3%. Fresnillo was up 6.4%, Antofagasta was up 6.3%, Endeavor Mining was up 3.9% and Glencore was up 3.3%.
“The sharp sell-off in gold in recent days has encouraged investors to buy the dips, scooping up the precious metal en masse and making it shine again,” said Russ Mould, analyst at AJ Bell.
Thursday is the deadline for Rio Tinto to sign a bid for Glencore.
On Tuesday, Glencore said Orion Critical Mineral Consortium is considering buying a 40% stake in Glencore's interests in its DRC assets, Mutanda Mining and Kamoto Copper Co, for around $9 billion.
On the FTSE 250, Plus500 rose 7.0% after announcing the launch of a US prediction markets platform with a regulated business-to-consumer offering.
The Haifa, Israel-based contracts for difference trading platform operator said it entered the US retail prediction markets segment with the launch of the platform that includes products from Kalshi Exchange, which Plus500 says is the first regulated event-based contracts exchange in the US.
AG Barr rose 5.7% as it said its annual operations were in line with forecasts and announced the acquisitions of the Fentimans and Frobishers Juices brands.
The Cumbernauld-based soft drinks manufacturing company said revenue for the year ending January 31 rose around 4% to around £437m from £420m a year earlier.
The Irn-Bru owner achieved “modest growth” in the second half, he said, with “good results” from Rubicon and Boost.
Stocks in New York were down. The Dow Jones Industrial Average was down 0.1%, the S&P 500 index was down 0.6% and the Nasdaq Composite was down 1.3%.
PayPal plunged 19% after naming a new CEO as fourth-quarter results and guidance fell short of forecasts.
The San Jose, California-based financial transaction processing services company said performance had been “solid,” but execution “has not been where it needs to be, particularly in branded payment.”
PayPal said some progress has been made in several areas over the past two years, but that “the pace of change and execution was not in line with the board's expectations.”
As a result, PayPal named Enrique Lores as president and CEO, effective March 1.
Lores, who has served on PayPal's board of directors for almost five years and has been president since July 2024, succeeds Alex Chriss.
Another change at the top came at Disney, which announced that CEO Robert Iger will resign next month.
The expected move sees Disney Experiences president Josh D'Amaro promoted to CEO, as has been widely noted.
Disney, which reported its results on Monday, was down 2.4%.
The yield on the 10-year US Treasury bond was trading at 4.29%, down from 4.25%. The 30-year US Treasury yield was quoted at 4.92%, widening from 4.85%.
The pound was trading higher on Tuesday at $1.3695 at the close of the London Stock Exchange, up from $1.3651 on Monday.
The euro rose to $1.1818 against $1.1804. Against the yen, the dollar was trading higher at 155.73 yen compared to 155.52 yen.
Elsewhere, CyanConnode soared 19% after announcing it had received a takeover offer from Dubai-based Esyasoft Holding.
The Cambridge-based developer of narrowband radio frequency mesh networks said the potential takeover bid would value it at £35 million, around 9.75 pence per share.
Brent oil was trading at $67.15 per barrel at the close of the London Stock Exchange on Tuesday, up from $66.03 on Monday.
The biggest risers on the FTSE 100 were Anglo American, up 250.0p to 3,700.0p. Fresnillo, with an increase of 234.0 pence to 3,902.0 p. Antofagasta, with an increase of 228.0 pence to 3,868.0 p. 16.3p to 517.3p.
The biggest fallers on the FTSE 100 were Relx, down 371.0p to 2,214.0p, London Stock Exchange Group, down 1,054.0p to 7,180.0p. at 2,555.0p.
Wednesday's global economic calendar includes a series of composite PMI readings, eurozone PPI figures and US ADP payrolls data.
Wednesday's UK corporate calendar includes full-year results from pharmaceutical company GSK.
– Contributed by Alliance News
