The FTSE 100, the main index of the London Stock Exchange rose Friday to 7906.58 points, a new record in session, driven forward by its multinationals despite recent bad news on the British economy.
The index surpassed its previous high of May 22, 2018 at 7903.50 points.
It ended Friday up 1.04% at 7901.80 points, also erasing its closing record, which had also been reached on May 22, 2018 at 7877.45 points.
The London market was driven in particular by the energy giant Shell, which climbed 3.27% after unveiling a record profit the day before, thanks to the surge in hydrocarbon prices in the wake of the invasion. of Ukraine via Moscow.
The index also benefited from the weakness of the pound on Friday, after the US employment report showed a faster than expected increase in job creations in the United States in January.
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A weaker British currency has the advantage of mechanically increasing the value of the results achieved by companies in other currencies, which notably benefited the British hygiene and health products group Reckitt Benckiser (+3.20 % at 5,806 pence) or at the Astra Zeneca laboratory (+ 3.20% also, at 10,578 pence).
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A sense of optimism swept through markets on Friday, pushing the FTSE 100 to a record high on the heels of U.S. jobs gains as investors shrugged off recession concerns
," he said. AFP Susannah Streeter, Hargreaves Lansdown analyst.
According to the IMF, the United Kingdom will be the only major economy to suffer a recession in 2023. But the Bank of England said on Thursday that the contraction in British GDP would be less severe than expected.
"
The FTSE 100 has clearly regained its 'mojo' after a difficult period when investors appeared to be turning away from UK assets
," Ms Streeter continued.
"
The composition of the index, with a strong bias towards commodities, utilities, financial services and global consumer giants, is proving particularly attractive
," she said.
Recovery in China
The index thus benefited from the reopening of China, which is boosting commodity companies with the prospect of rising demand, from the increase in interest rates which is stimulating banking stocks and from the recovery of travel for the benefit of airlines.
For Russ Mould, analyst at AJ Bell, "
the dominant theme seems to be that +better times are coming+
", when a lot of bad news has already been priced in by investors, energy prices are down and the inflation is expected to fall.
The FTSE also has some catching up to do with other global markets: where the CAC 40, the DAX or the Dow Jones have long since greatly exceeded their pre-Covid levels, the British market has risen at reduced speed, ballasted especially with Brexit.
However, the FTSE 100 has been in exceptional health since the start of 2022, in the green despite the war in Ukraine, driven by its oil and mining champions, which enabled it to regain, and then exceed, its pre-existing levels a few weeks ago. pandemic.
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“
The FTSE 100 is partly made up of energy companies and mining companies, which have largely benefited from the surge in inflation and the energy crisis that hit after the outbreak of the Russian-Ukrainian war
”, sums up Marcus Brookes, of Quilver Investors.
But “
with the possibility of a recession on the horizon, the index may still have significant volatility in store for investors
,” warns the analyst.
“
The FTSE 100, like many stock indices, tends to perform poorly in times of recession.
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