Turbulent trading year ends on a high for London's FTSE 100
London's top-flight index surged to an all-time high and recorded its best year since 2013 after riding out a turbulent 12 months thanks to a boost from the Brexit-hit pound.
The FTSE 100 smashed its mid-session record and set a new all-time closing high by rising 22.57 points to 7,142.83.
The late surge saw the UK's premier index break above the mid-session record of 7129.83 recorded on October 11 and reach a fresh closing high for the third day running.
It came as London emerged as the best performer out of the major European stock markets this year, finishing 2016 more than 14% higher despite Britain's vote to leave the European Union on June 23.
The pound's fall, triggered by Britain's decision to quit the EU, has proved beneficial for multinational companies listed on the index as many tend to benefit from earnings in currencies - such as the US dollar - which are stronger than sterling.
On Friday, sterling slumped further against the euro, falling 0.1% to 1.16 euro. The pound was up 0.5% against the US dollar at 1.23.
Sterling remains 18% down against the greenback and 11% lower versus the euro since the Brexit vote in June.
The FTSE 250 finished 2016 in the black, rising 47.77 points to 18,077.27.
It means the second tier, which is made up of UK firms deemed a better gauge for the domestic economy, was more than 3% higher than last year.
Across Europe, Germany's Dax and the Cac 40 in France were up 0.3%.
The price of oil eased back - down 0.4% at 56.61 US dollars a barrel - but remained on track for its biggest yearly gain since 2009.
The London market was on the back foot at the start of 2016, dragged down by concerns over slowing growth in China and a lack lustre performance from blue-chip mining stocks.
But while global turbulence remained a key factor in the market swings of 2016, the lion's share of the jitters came from tectonic shifts in Britain's political landscape.
After pricing in Britain to remain in the EU, the top-flight issued a sharp correction on June 24, as the Brexit vote and the resignation of Prime Minister David Cameron unleashed a tsunami of political uncertainty that rocked European markets.
But the London market would mount a recovery in the months ahead as sterling's slump in the wake of the Brexit vote would prove a boon for London-listed multinational companies, helping it reach a new mid-session record of 7,129.83 on October 11.
In a similar vein to Brexit, markets were forced to administer sharp corrections for the US election after pricing in the opposite outcome - a triumph for Democratic candidate Hillary Clinton.
However, the so-called Trump slump quickly transformed into a Trump bump, with the Dow Jones Industrial Average hitting a record high on November 11 and helping the FTSE rally to fresh closing highs in December after investors took their cues from the US.
Shopping centre owner Hammerson helped the FTSE 100 achieve fresh records on Friday after inking a deal with Singapore's sovereign wealth fund GIC to offload a 50% stake in the newly opened Watermark leisure complex in Southampton.
Shares closed up more than 1% or 10p to 573p.
The biggest risers on the FTSE 100 Index were Coca-Cola HBC up 38p to 1,770p, London Stock Exchange Group up 59p to 2,914p, Hikma Pharmaceuticals up 36p to 1,893p, TUI up 21p to 1,163p.
The biggest fallers on the FTSE 100 Index were Rolls-Royce Holdings down 10p to 668p, BT Group down 4.1p to 366.9p, DCC down 55p to 6,040p, United Utilities down 6.5p to 901p.