Mid-August can often provide a quiet period for most people to take a holiday or relax with the kids. It’s also when I can dedicate time to looking ahead and seeing where I think the FTSE 100 could go. From that, I can then drill down into specific picks. So what did my AI friend ChatGPT have to say about the index pushing higher?

Less optimistic than expected

For context, I chose 11,000 points as that sits just above the record high of 10,989 points on 31 July. More than that, the index has fallen in recent weeks and now sits at 10,757. So the 2.2% move back to 11,000 points is important to me as it would show renewed momentum from investors, acting to push the Footsie to fresh record highs.

In terms of the timescale, I chose one month, with mid-September usually being considered the end of summer. To my surprise, ChatGPT only assigns a 55% chance of this happening.

It rated the chance mildly higher than 50/50, citing positive medium-term momentum and a supportive global backdrop. However, it flagged up commodities as the big risk. It spoke of the potential for another large oil shock that could revive inflation concerns, push bond yields higher and damage broader risk sentiment.

Adding in my view

Yet I believe there’s a much higher chance of the market rallying in the coming month and would put the probability closer to 80%. A big factor I don’t think is being discussed enough is investors looking to diversify their exposure away from AI stocks. The FTSE 100 supports this theme, given that it’s dominated more by financial services stocks, along with healthcare and energy. These sectors are all performing well and so could see more gains as people allocate more money to them.

This makes me consider picking stocks from these areas, as the profits here could be larger than just buying an index tracker. For example, Barclays (LSE:BARC) is one I rate highly.

The stock is already up 40% in the past year, with the biggest driver being improving profitability. Barclays reported £6.1bn of pre-tax profit for the first half of 2026, up 17% year on year and ahead of expectations. Its investment bank has been particularly useful, with second-quarter equities revenue jumping 45% amid elevated market volatility. Management also nudged full-year income guidance higher to £31.5bn.

Then there’s all the cash being returned to shareholders. Barclays announced another £1bn share buyback alongside £800m of dividends at its half-year results. Buybacks reduce the share count and can boost earnings per share, providing another potential catalyst if profitability remains strong.

I think the broader backdrop could remain supportive too. Higher-for-longer interest rates can help lending income, while resilient markets and investment banking performance could remain strong.

However, one risk is that it expects an additional £500m of second-half costs, which could weigh on the next set of results. Any UK economic wobble could also increase bad debts.

Nevertheless, with profits growing and substantial capital returns, I think it could outperform the broader FTSE 100 in the coming months and so is worthy of consideration by investors.

Should you invest £5,000 in Barclays Plc right now?

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Jon Smith does not hold any positions in the companies mentioned.