London’s main stock index, the FTSE 100, hit a historic milestone on Friday by crossing the 10,000-point mark for the first time.
This achievement follows a strong performance in 2025, where the index rose nearly 22%, its best year since 2009 beating major markets in Europe and the US.
While global markets have been largely driven by excitement over Artificial Intelligence, the UK’s rally was powered by different sectors: mining companies benefited from high metal prices, defense firms grew due to increased military spending, and banks profited from high interest rates.
The large international companies in the FTSE 100 significantly outperformed smaller, domestic UK businesses.
Although the UK index still grew slower than markets in Japan and Italy, reaching this new record offers hope for renewed investor confidence after years of uncertainty surrounding Brexit and political instability.
On the FX front, the US dollar started 2026 with a small recovery, rising 0.2% on Friday after suffering its worst year in nearly a decade with a 9.4% drop in 2025. While the dollar stabilized, the Euro dipped slightly and the British Pound remained near its recent highs; both European currencies had surged last year, recording their strongest annual gains since 2017.
In the Pacific, the Australian and New Zealand dollars continued their winning streaks, starting the new year with further gains after strong performances in 2025.
Overall trading was quiet because markets in Japan and China were closed, but investors are watching closely for upcoming US economic data to help predict future interest rate changes.
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