The FTSE 100 index stood above 7,000 for the first time in over a year today as London’s resurgent stock market celebrated a big milestone in its pandemic recovery.
The index, which tumbled to below 5,000 points at the height of Covid-19 panic in March last year, rose 40.67 points today and is up more than 100 points this week after investor confidence was boosted by more signs that the global economy is accelerating.
Unlike the record levels of Wall Street benchmarks, today’s high of 7,024.17 for the FTSE 100 index is still some way short of the all-time closing level of 7,877 set in May 2018.
However, AJ Bell’s investment director Russ Mould said today’s performance was still a “massive milestone” in the recovery.
He added: “The market was understandably shocked as the coronavirus gripped the world but in true investor style it has quickly focused on the future and the ability for corporate earnings to recover.”
Wall Street’s S&P 500 pushed further into record territory last night, rising another 1.1% on the back of a better-than-expected 9.8% jump in retail sales as Americans began spending their stimulus handouts.
Latest figures on China’s economic rebound also helped after new GDP numbers showed the country expanded by 18.3% year-on-year and by 0.6% on a quarterly basis.
While a spike in inflation is a constant threat to the stock market party, there was encouragement today as bond yields fell despite the latest economic figures.
CMC Markets’ analyst Michael Hewson pointed out that this could mean two things: “Either the recovery is already in the price, or markets think this is as good as it gets.” He doubts the latter, citing that April jobs figures in the US could push bond yields higher again.
Today’s biggest blue-chip risers included BT Group, which jumped 2.85p to 153.4p after analysts at JP Morgan raised their price target to 230p. BP also lifted 2.25p to 305.75p after HSBC placed a “buy” recommendation on the oil giant.
The FTSE 250 index is already trading at a record level, with the UK-focused benchmark 49.97 points higher at 22,522.04. Emerging markets fund manager Ashmore was 5p higher at 423p and hedge fund group Man up 1.25p at 166.7p after their latest trading updates.