The FTSE 100 index has recently achieved a milestone, reaching a record high of 8,076.
This accomplishment comes with a backdrop of international underperformance, raising questions about the factors driving this surge and its sustainability.
In contrast to the straightforward ascent of the S&P 500 index in the US, which has seen a remarkable 22% increase over the past 14 months, the FTSE 100’s journey to its previous record level of 8,047 in February last year has been marked by a slower and more meandering path. This discrepancy underscores the unique challenges facing the UK’s premier index amid global economic dynamics.
A significant driver behind the FTSE 100’s recent gains is the strengthening of the US dollar against major currencies, including the pound sterling. This currency effect has bolstered the sterling-denominated share prices of companies with substantial foreign earnings, such as Shell and BP, both of which derive…
