The FTSE 100 has hit an all-time high in what traders are calling a traditional pre-Christmas “Santa Rally”.
The index of blue-chip shares traded on the London market hit 7609.69 in Thursday afternoon trade, up 1.1 per cent on the day and passing the previous intraday record of 7,598.99 set in June.
It closed at 7,603.98, also a record.
“Favourable seasonality effects [are] probably playing an important role,” said David Cheetham, chief market analyst at XTB, noting that there was no particular economic or corporate news reason why the index should be up.
“December has been the second best month for UK stock market bulls in the past decade and the FTSE has enjoyed a strong run higher heading into the Christmas break. The much discussed Santa Rally could still be to come and from a technical point of view a clean break higher after a fairly long period of consolidation paves the way for significant upside ahead.”
All-time high
The FTSE 100 is dominated by multinationals, rather than domestically-focused British companies, and the index tends to be sensitive to movements in sterling since a large share of the earnings of its constituent firms are denominated in foreign currencies.
Sterling was trading down 0.19 per cent against the dollar at $1.3356.
The FTSE 250, which contains many more UK-oriented firms, closed up 0.36 per cent and the FTSE all-share was 0.92 per cent higher.
In the US, the S&P 500 was up 0.36 per cent in early trade, buoyed by Congress’s approval of corporate tax cuts on Wednesday.
The European Stoxx 600 ended up 0.3 per cent.
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