22nd Oct 2026 09:01
(Alliance News) - Stock prices in Europe opened lower on Thursday, with a fresh bout of artificial intelligence sector worry, coupled with a lofty oil price due to ongoing Middle East tensions, keeping a lid on enthusiasm.
A raft of other corporate updates offered plenty of other sub-plots, meanwhile. London Stock Exchange Group shares moved higher, Barclays declined as its earnings fell short of consensus, while Paris-listed Hermes weighed on luxury peers.
The FTSE 100 index fell 65.39 points, 0.6%, at 10,687.49. The FTSE 250 slumped 206.61 points, 0.9%, at 24,233.17, and the AIM all-share fell 6.79 points, 0.9%, to 756.33.
The Cboe UK 100 traded down 0.6% at 1,061.17, the Cboe UK 250 was 0.9% lower at 21,336.74, while the Cboe small companies was down 0.4% at 19,049.85.
In European equity markets on Thursday, the CAC 40 in Paris was down 1.1%, while the DAX 40 lost 0.9%. Hurting Paris, Hermes shares slumped, dragging luxury peers with it.
In Tokyo, the Nikkei 225 ended down 2.7%. In China, the Shanghai Composite fell 1.5%. The Hang Seng Index in Hong Kong tumbled 3.0% in late trade, while Sydney's S&P/ASX 200 ended down 0.4%.
"Earnings are coming in strong, but the reaction at the index level fails to match that enthusiasm," Swissquote analyst Ipek Ozkardeskaya commented.
"Earnings are coming in stronger than expected, triggering positive knee-jerk reactions. Yet gains are either rapidly given back or fail to snowball into broader, lasting enthusiasm. Nasdaq futures are down this morning - and leading losses - despite strong tech results announced in the last few hours, suggesting that even strong earnings may no longer help investors overlook troubles elsewhere."
Meta had sat some 7% higher after hours, but settled to a more modest 2.2% higher. Although its earnings impressed, a remark about rising serving costs associated with an AI offering spooked the wider market.
Chief Financial Officer Susan Li said that AI agent Muse's computing intensity means that expanding its user base will require significant investment and she expects total serving costs to rise.
SPI Asset Management analyst Stephen Innes commented: "Meta initially gave the bulls exactly what they wanted, with a strong revenue outlook and another reminder that the underlying demand for AI remains healthy, but the enthusiasm began to fade once the company made clear that the next leg of the buildout would require significantly more investment and higher serving costs. That distinction matters because the market is no longer rewarding AI spending simply because management can attach a large number to it. The question has become whether the economics improve quickly enough to justify the cheque, and Meta's warning landed directly on the fault line the market has been worrying about for weeks."
Stocks with an AI exposure were hit hard in Asia, with SoftBank slumping 6.9% in Tokyo, while Samsung Electronics and SK Hynix declined 4.0% and 5.5% in Seoul.
In London, tech investors Scottish Mortgage and Polar Capital Technology each fell 2.7%.
LSE rose 2.8% as it lifted annual guidance, reported third quarter growth quickened and announced a USD3.54 billion deal to acquire Octus.
The Octus buy creates a "market leader across public and private credit solutions", the index operator and market data firm said.
Octus is being acquired from Permira and the credit intelligence, data and workflows provider's management, including founder Kent Collier.
Barclays declined 1.1% as its third quarter profit fell short of expectations.
The lender reported a 4% on-year total income rise in its Global Markets arm, helped by a 47% surge in Equities, but in Fixed Income, Currencies & Commodities, there was a 19% slump.
Analysts at Shore Capital Markets commented: "FICC was particularly weak and the overall IB performance looks disappointing relative to US peers."
Inchcape was the worst FTSE 250 performer, slumping 8.1%. The automotive distributor hailed a "resilient" third quarter performance, but it cut its guidance amid woes in Australia.
"Australia remains a challenge - our key brand has underperformed, with deteriorating competitiveness in a rapidly-evolving market. We are taking further decisive action there, alongside our existing restructuring activity. We are confident these actions will improve our business in Australia over time, but we expect the current challenges in that market to continue impacting our performance there," Chief Executive Duncan Tait said in a trading statement.
Inchcape now expects a lower operating margin for 2026 of around 5.5%, with adjusted earnings per share growth of some 10%. It had previously expected a margin of around 6% and EPS growth of more than 10%.
Elsewhere in London, Record rose 7.9%. The currency and asset manager said assets under management at the September 30 second quarter end amounted to USD130.3 billion, up 7% from USD122.0 billion in June.
Record reported net inflows of USD10.4 billion.
"This marks a fifth consecutive quarter of positive net flows for the group. This was partially offset by underlying asset movements and impacts from foreign exchange movements," Chief Executive Officer Jan Witte said.
Camellia slumped 12%. It currently forecasts full-year revenue to be between GBP255 million and GBP260 million, down from GBP268 million in 2025, the holding company for agriculture businesses said.
"Trading has also been affected by a downturn in global avocado and macadamia nut prices and lower crop yields for both products. As a result, Camellia's trading result for 2026 is expected to be weaker than previously anticipated," it warned.
"The group has seen stronger trading performances in the Bangladesh, India and Eastern Produce Kenya tea businesses and the Brazilian arable business is performing in line with expectations. This has been more than offset by weaker results from Kakuzi."
Camellia owns just over 50% of London listing Kakuzi.
Kakuzi on Thursday said it expects net earnings to be significantly lower than the previous year "as a result of the continued downturn in the macadamia market and a lower macadamia crop".
Kakuzi shares were unmoved on Thursday.
Sterling traded at USD1.3401 early Thursday, from USD1.3389 at the time of the London equities close on Wednesday. Against the euro, it faded to EUR1.1921 from EUR1.1930. It hit EUR1.1939 on Wednesday, its best level against the common currency since May 2025.
The euro rose to USD1.1237 from USD1.1225 at the time of the closing bell in London on Wednesday. Against the yen, the dollar faded to JPY157.19 from JPY158.05.
The yield on the 10-year US Treasury narrowed to 5.08% early Thursday, from 5.11% late Wednesday afternoon. The 30-year yield narrowed to 5.38% from 5.41%.
A barrel of Brent surged to USD111.59 early Thursday, from USD109.14 late Wednesday afternoon. Gold traded at USD4,089.16 an ounce, down from USD4,139.04.
Analysts at Deutsche Bank commented: "The New York Times reported that the US and Israel had drawn up plans for renewed strikes against Iran after the midterm elections, with the report saying targets would likely include Iran’s energy infrastructure. Moreover, the strikes on Saudi Arabia continued, with two people killed in an attack on the Shaybah oil field in Saudi Arabia, whilst another was killed in a strike on the King Fahd International Airport. In the meantime, the US State Department issued an ordered departure for non-emergency government employees and family members in Saudi Arabia. All those headlines have come amidst little sign of progress towards a deal."
Thursday's global economic calendar has a consumer confidence report in the eurozone at 1500 BST, after initial jobless claims data in the US at 1330.
In Paris, Hermes was down 8.0%. Hermes said third quarter revenue rose 4.3% at constant currency, slowing from a 6.7% climb in the second quarter.
By Eric Cunha, Alliance News news editor
Comments and questions to [email protected]
Copyright 2026 Alliance News Ltd. All Rights Reserved.
Related Shares:
KakuziCamelliaInchcapeRecordBarclaysLondon Stock Exchange