Shares in British chip designer Arm fell sharply in New York, but it would still be the fifth-largest company in the FTSE 100 if it had chosen to list in London.
The Cambridge-based tech giant has risen in value in recent weeks thanks to excellent results and enthusiasm for artificial intelligence.
The stock hit a high of $149 on Monday, valuing it at more than £120bn, after listing on New York’s Nasdaq at just $51 last year. But shares fell more than 19 percent yesterday as they gave up some of their recent gains.
However, Arm is still valued at around £98 billion. That makes it one of the UK’s most valuable listed companies, behind Shell (down 0.3 per cent, or 7p, to 2,488.5p) at £163bn, AstraZeneca (up 1 per cent, or 99 pence, up to 9,600 pence) with £149 billion. , HSBC (up 0.4 per cent, or 2.1p, to 610.5p) to £117bn and Unilever (unchanged at 3,992.5p) to £99bn.
Arm’s success since listing in New York has rubbed salt in the City’s wounds after a campaign to convince it to trade its shares in London fell on deaf ears.
Below: Arm has skyrocketed in value in recent weeks thanks to excellent results and frenetic enthusiasm for artificial intelligence. But shares fell 13.9% as they gave up some recent gains.
Founded in 1990, Arm has long been hailed as a UK tech darling, designing microchips used in smartphones and other devices.
It was listed on both the FTSE 100 and Nasdaq before being taken private by Japan’s SoftBank in a £26bn deal in 2016.
When he returned to the stock market last year, he chose New York despite lobbying from Prime Minister Rishi Sunak and the London Stock Exchange.
Dan Ives, a technology analyst at Wedbush, a Los Angeles-based wealth manager, said: “Arm appears to remain a black eye for London.”
The drop in Arm’s share price came as concerns about inflation and interest rates sent stock markets around the world tumbling.
The FTSE 100 fell 0.81 percent, or 61.41 points, to 7,512.28 and the FTSE 250 lost 1.46 percent, or 280.10 points, to 18,923.83 in London.
Meanwhile, the S&P 500, the Dow Jones Industrial Average and the Nasdaq were falling in New York.
Back in the City, Aston Martin shares were in the spotlight amid hopes that it is finally tackling its huge debt.
Stock Watch – Saietta
Shares of a company that makes parts such as engines for light-duty electric vehicles plummeted to a record low after a lucrative deal fell through.
Saietta failed to agree the terms of an electric steering pump contract at its Sunderland facility.
As a result, the company will sell a production line it no longer uses at the site for £600,000.
This will provide funds, although more cash injections will be needed for Saietta to stay afloat. The shares fell 53.5 per cent, or 8.56p, to 7.44p.
The luxury car maker has spent recent years shoring up its finances and attracting investors to help put the business on a firmer footing.
But Aston Martin faces having to pay off more than £1bn of debt.
In a sign that progress is being made, Chairman Lawrence Stroll told Bloomberg TV: “We are currently studying with our bankers the most appropriate actions to address it.” Shares were stable at 174.2 p.
Defense stocks fell, with Rolls-Royce down 0.9 per cent, or 2.8p, to 306.3p, BAE Systems down 0.9 per cent, or 11.5p, to 1,212.5 py Qinetiq down 1.1 per cent, or 4p, to 369p.
But George Zhao, an analyst at Bernstein, said pressure on NATO members – particularly from US presidential hopeful Donald Trump – to increase defense spending should provide a boost.
He said: “Many have seen this as a potential positive catalyst for European defense stocks.”
It was a strong session for GSK after an improvement from the rider.
Investment bank Citi urged its clients to buy shares of the pharmaceutical giant for the first time in seven years.
Analysts said the company’s top-line drug portfolio is strong, while long-standing litigation over Zantac should be resolved in the next six months. The shares rose 1 per cent, or 15.4p, to 1,641.8p.
In the other direction was ITV. Mayfair-based Silchester International Investors fund, which also has stakes in Tesco (down 2.1 per cent, or 5.9p, to 273.7p), GSK and B&Q owner Kingfisher (down 2.3 per cent, or 5p, to 215.8p), has bought a 5 per cent stake in the broadcaster.
But with ITV grappling with a drop in advertising spending, shares fell 2 per cent, or 1.16p, to 57.32p.
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