The FTSE 100 index of leading shares hit a record closing high on Wednesday at 7,106 – up 0.54% on the day after the stockmarket re-opened after the Christmas break.
The new high was two points above the previous closing peak in April last year, and with 2 trading days to go the index has risen by 13.8% in 2016 – its best annual performance since 2009.
UK equity markets have enjoyed their traditional “Santa rally”, rising strongly throughout December, but yesterday’s climax was reached in subdued dealings with much of the City still on holiday and few corporate or economic updates. Trading volumes were less than half of levels earlier this month.
British stocks joined a broader global rally in which the Dow Jones industrial average has threatened to surpass the psychologically important 20,000 mark. The Dow eased back yesterday, though, down 111.36 points to close at 19,833.68.
The FTSE 100’s rise was led by mining stocks, which make up a significant part of the index and continued this year’s strong rebound.
The recovery in oil prices has also supported stocks. Brent crude, which traded below $28 a barrel in January, was above $56 yesterday, having been lifted by the Opec cartel and other big producers agreeing the first production cuts since 2001 to address oversupply this month.
Currency has also played a big part in the rise since the BREXIT vote in June with the index dominated by international companies earning in US dollars, which has strengthened against the Pound.
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