FTSE 100 tops 8,500 to hit new record on hopes of rate cuts to boost flat economy
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The FTSE 100 has topped 8,500, beating a previous closing record of 8,474 last May. The new all-time closing high came on the back of a weaker pound, which was trading at $1.22 against the dollar, and expectations of further interest rate cuts to boost a flat economy.
Bitcoin also surged to $104,882 ahead of the inauguration of Donald Trump, who may build a strategic reserve of cryptocurrencies in his second term as US president. The FTSE 100 has topped 8,500 on expectations of future interest rate cuts by the Bank of England to boost a flat economy.
Finance, mining and building stocks were among the top risers on the FTSE 100, which ended the day up 1.4 per cent or 113.32 points at 8,505.22. The domestically oriented FTSE 250 posted a more modest gain of 0.3 per cent to finish at 20,597.42. 'The FTSE 100 has caught that Friday feeling, surfing upwards on a wave of enthusiasm,' says Susannah Streeter, head of money and markets at Hargreaves Lansdown.
'The blue-chip index is stuffed with global giants, like miners, which benefit from cheaper sterling, and were among the biggest gainers of the morning.'. She says the pound fell after the disappointing snapshot of retail sales this morning showed a contraction for the so-called 'golden quarter' at the end of last year, which adds to the picture of stagnation for the UK economy.
'But it's provided a tailwind to multinationals and hopes of interest rate cuts from the Bank of England have buoyed investor sentiment.'. Jo Rands, portfolio manager at Martin Currie, part of Franklin Templeton, says the FTSE 100 record has come despite negative rhetoric around rising gilt yields and the outlook for the UK economy.
