"Now Together" UK and Pan-European Stock Markets Reach All-Time Highs Simultaneously

Photo of Rishi Sunak, Prime Minister of the United Kingdom [Image source=Yonhap News]

The FTSE 100, the leading stock index of the London Stock Exchange in the UK, hit record highs for five consecutive trading days. At the same time, pan-European stock markets also continued their rally for five straight trading days, reaching all-time highs.

On the 9th (local time), the FTSE 100 index, composed of UK blue-chip stocks, closed at 8,381.35, up 0.33% from the previous day. This marks the fifth consecutive trading day of closing record highs since the 2nd, the longest rally since January 2017. The FTSE 100 index has risen more than 8% this year, more than double last year's annual gain of 3.8%.

Earlier this year, the London stock market lagged significantly behind other European markets, but the situation changed rapidly from last month. This was due to expectations that the Bank of England (BOE), the UK's central bank, would cut interest rates following a slowdown in UK inflation. In March, the UK Consumer Price Index (CPI) rose by only 3.2% year-on-year, the lowest level since September 2021 (3.1%).

On the day, the BOE kept interest rates unchanged, but the market is hopeful for a cut this summer. Andrew Bailey, Governor of the BOE, said, "More evidence is needed to confirm that inflation is stabilizing," but added, "I am optimistic that the situation is moving in the right direction." Richard Plax, Chief Investment Officer at Moneyfarm, told AFP, "Among analysts, there is cautious optimism that the first rate cut this summer could be the first since the pandemic."

The weakness of the pound against the dollar and strong earnings from UK-based multinational corporations are also considered positive factors for the London stock market.

Meanwhile, major stock markets in the European Union (EU) are also showing upward trends.

The pan-European benchmark index, the Euro Stoxx 600, recorded gains for five consecutive trading days, closing at an all-time high. On the same day, Germany's DAX index and France's CAC 40 index, the largest economies in Europe, rose by 1% and 0.7%, respectively. These markets have risen 11% and 9% so far this year.