The FTSE 100, the index comprising the UK’s largest 100 companies, registered its all-time highest close last night (21 July), ending a session above the 9,000 mark for the first time in its history.
With the UK’s top stocks, such as Rolls-Royce (LON:RR.), BP (LON:BP.) and Glencore (LON:GLEN) all included in the index, the FTSE 100 is a key bellwether for the health of the UK economy.
All British investors, from experienced stock market experts to beginners, will keep a close eye on the index. Some of the best funds for beginner investors are trackers that follow the index.
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So it’s good news that the FTSE 100 has closed above 9,000. So far this morning (22 July), despite opening below 9,000, it has managed to quickly return to above the threshold.
“Investors are weighing up fresh company results alongside the latest public borrowing figures,” said Matt Britzman, senior equity analyst at Hargreaves Lansdown.
“The achievement highlights the resilience of UK equities despite ongoing economic challenges and political uncertainty,” said Chris Beauchamp, chief market analyst at IG. “Major constituents including energy giants, banks, and consumer staples have all contributed to this steady climb throughout the year.”
Reaching the 9,000 milestone is one thing, but Brits – chancellor Rachel Reeves especially – will be hoping that the FTSE 100 can maintain these levels. That could prove challenging, given a recent survey indicating that investor confidence in the UK is falling.
What has pushed the FTSE 100 over 9,000?
The FTSE 100’s first close above 9,000 has been down to solid growth across a range of sectors.
Several specific events have driven gains yesterday and this morning.
It was mostly about the miners yesterday. Rising iron ore prices pushed the index’s mining stocks higher.
“Mining shares typically get a boost when commodity prices rise and/or there is good news from China, which is one of the world’s biggest users of metals and minerals,” said Dan Coatsworth, investment analyst at AJ Bell. “Both were in play today.
“China is powering ahead with a $167 billion hydropower project which will need significant amounts of construction materials,” Coatsworth continued. That has boosted the stocks of miners like Anglo American (LON:AAL) and Rio Tinto (LON:RIO).
This morning, energy firm Centrica’s (LON:CNA) shares gained over 4% following news that it will take a 15% equity stake in the Sizewell C nuclear project, representing “a major endorsement of Britain’s nuclear energy future”, according to Beauchamp.
Beauchamp also highlighted AstraZeneca’s (LON:AZN) planned $50 billion investment in the US, as well as continuing pressure from activist investor Elliott on BP’s new chairman to address the oil major’s operational challenges.
Can the FTSE 100 stay above 9,000?
The FTSE 100 is enjoying a strong 2025 so far, having gained over 10%, compared to the S&P 500’s 7%.
Whether or not that can continue is up for debate. Investors seem to be turning pessimistic on the UK.
Hargreaves Lansdown’s Investor Confidence Index indicated a 26% downturn in investors’ confidence in UK economic growth during July, despite confidence in growth in every other region increasing.
“This isn’t a huge surprise given economic and political stability has been called into question,” said Kate Marshall, lead investment analyst at Hargreaves Lansdown. “UK GDP has slowed, business costs are mounting, and policy reversals from the Labour party have dented its fiscal credibility.”
But the strength of the UK economy doesn’t necessarily have too strong a bearing on the index. More than 80% of the revenues from its component businesses are derived from abroad.
“Indeed, some of the constituents, such as telecoms group Airtel Africa (LON:AAF) make all their sales overseas,” says Jemma Slingo, pensions and investment specialist at Fidelity International.
Whether or not the FTSE 100 maintains its level above 9,000 is unclear. But Slingo points out that, as things stand, the index is cheap compared to international counterparts, and also offers relatively high dividend yields.
Our explainer on the top stocks in the FTSE 100 includes tips on how to gain exposure to the index, for any investors that feel now is the time to buy in.
