US stocks moved lower on Tuesday as fresh concerns over competition in artificial intelligence chips unsettled investors, while renewed tensions in the Middle East lifted oil prices and provided support for energy shares.
The Dow Jones Industrial Average slipped 0.2% after closing at a record high a day earlier, while the S&P 500 lost 0.5% and the Nasdaq Composite dropped 1.2% as semiconductor stocks came under renewed pressure.
Selling accelerated after reports suggested Chinese start-up DeepSeek is developing its own artificial intelligence chip, raising the prospect of increased competition for established names including Nvidia.
Samsung’s quarterly earnings also failed to reassure markets despite the company reporting a 19-fold increase in second-quarter operating profit, driven by strong demand for artificial intelligence. Investors instead focused on questions surrounding future AI spending and whether current levels of demand can be maintained, adding further pressure to technology shares.
Rising oil prices became another major theme after reports of Iranian attacks on commercial vessels in the Strait of Hormuz, an important shipping route that had recently seen traffic begin to recover following a fragile US-Iran peace agreement. Brent crude climbed above $75 a barrel while West Texas Intermediate traded above $71, boosting sentiment towards oil producers.
London’s market largely avoided the broader weakness seen across Europe and the US as the FTSE 100 edged up 14.11 points, or 0.1%, to finish at 10,665.88. The FTSE 250 was less resilient, falling 125.40 points, or 0.5%.
Shell provided the biggest lift to the blue-chip index after climbing 3.4% on the back of stronger second-quarter guidance for its integrated gas business.
The company increased its expected production range to between 610,000 and 650,000 barrels of oil equivalent per day and said gas trading should be significantly stronger than in the previous quarter as volatility linked to the Middle East created more favourable trading conditions.
Higher crude prices added further support for Shell, although gains across the wider index were capped by heavy losses among mining companies. Fresnillo fell 4.5%, Anglo American lost 4.6%, Antofagasta declined 3.3% and Endeavour Mining dropped 2.7%.
Away from the FTSE 100, Keller jumped 23% after telling investors it now expects 2026 revenue and underlying operating profit to come in materially ahead of current market forecasts. Victrex also enjoyed a strong session, rising 16% after delivering double-digit growth in both third-quarter revenue and sales volumes while maintaining its full-year guidance.
ITV was among the weakest performers on the FTSE 250, falling 7.3% after JPMorgan cut its rating to “neutral” from “overweight”. The bank said expectations surrounding a potential sale of the broadcaster’s media and entertainment business had not materialised, adding that the outcome represented “a good deal for Sky”.
