The FTSE 100 has recorded its best day in six months, closing at a fresh record as a broad-based global equity rally continued despite heightened geopolitical tensions.
London’s blue-chip index finished 118 points higher at 10,122, a gain of 1.18%, marking its largest daily percentage rise since 10 July and its biggest points increase since April. The move follows the index’s break above the 10,000-point level for the first time last Friday.
The advance was led by Fresnillo, which rose 5.2% as higher gold prices lifted precious metals stocks, and Next, up 4.9% after the retailer raised its profit forecasts following stronger-than-expected Christmas trading. Mining, pharmaceutical and energy stocks were also among the session’s strongest performers.
Gerald Toledano, group head of equities at FTSE Russell, said the index’s move above 10,000 was a significant milestone for the UK market, reflecting the international reach of its largest companies. Around three-quarters of FTSE 100 revenues are generated overseas, making the index a closer proxy for global economic conditions than the domestic UK economy.
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The rally in London came alongside strength elsewhere. Japan’s Nikkei closed at a record high, while the US Dow Jones Industrial Average reached a new intraday peak, underlining that investors have largely shrugged off geopolitical developments following the US intervention in Venezuela.
US markets were steady on Tuesday as traders awaited fresh economic data, including services activity readings, to gauge momentum in the American economy. Energy stocks consolidated recent gains, with Chevron edging higher after reports that Washington may subsidise oil companies investing in Venezuela’s energy infrastructure.
Across Europe, the picture was mixed. Germany’s DAX was marginally higher, while France’s CAC 40 recovered earlier losses to trade modestly up after slightly cooler-than-expected inflation data. The pan-European STOXX 600 gained more than 0.7%.
Commodities and sector mix support UK outperformance
UK equities have been buoyed by their heavy weighting towards energy, mining and financial stocks. Record copper prices and firmer precious metals supported miners, while oil majors including BP and Shell advanced after a brief spike in crude prices.
Retailers also helped lift sentiment after data showed shop price inflation ticking higher in December, driven by food costs over the festive period. Food price inflation rose to 3.3% year-on-year, while overall shop prices increased 0.7%, according to the British Retail Consortium.
Sterling eased 0.2% against the US dollar, trading towards $1.35, while the S&P 500 and Nasdaq Composite were modestly higher in early trading.
Neil Wilson, UK investor strategist at Saxo Markets, said the muted market reaction to geopolitical risks reflected a broader recalibration by investors. He argued that recent events underscored longer-term shifts towards a more fragmented and multipolar global order, even as equity markets continued to focus on earnings momentum and macro data.
For now, the FTSE 100’s record close suggests investors remain willing to look past geopolitical uncertainty, favouring sectors leveraged to commodities and global growth — strengths that continue to distinguish the UK market from its European peers.
