Santa rally pushes FTSE 100 to record high
The stock market rise has been chalked up to a year-end phenomenon called a Santa rally.
The FTSE 100 pushed to a record high on Thursday in a move that traders have chalked up to the so-called year-end “Santa rally”.
London’s blue chip index ended the day up 1.05% or 78.76p at 7,603.98 having pushed past the 7,600 mark for the first time.
The last time that the FTSE 100 hit a record high was in early November when it hit 7,562.28 points.
The jump has been credited to a market phenomenon called the Santa rally, referring to a surge in stock prices during the final weeks of December that is often linked to investments of Christmas bonuses as well as anticipation of a further rise in prices at the turn of the new year.
David Madden, a market analyst at CMC Markets UK, said: “The FTSE 100 is the standout performer in Europe as it reached a fresh all-time high.
“The market has cleared the 7600 mark, for the first time ever. Since consumer goods like Reckitt Benckiser, Diageo and Tesco are some of the biggest risers on the day, the Santa rally is certainly under way.”
The UK market outperformed European peers including the French Cac 40 and German Dax which ended the day up 0.6% and 0.3%, respectively.
In currency markets, the pound was relatively flat, trading lower by 0.3% versus the US dollar at 1.337 and 0.2% lower against the euro at 1.126.
Brent crude prices were edging higher by 0.15% at 64.56 US dollars per barrel, with gains muted by news that the North Sea Forties pipeline was set to come back online in the new year after being shut down for repair earlier this month.
In UK stocks, InterContinental Hotels Group jumped 97p to 4,703p after saying that Donald Trump’s tax reforms would reduce its effective tax rate “by mid to high single digit percentage points” from January.
Royal Dutch Shell’s ‘B’ shares rose 38p to 2,470p amid news that it had acquired First Utility in a move that will see the oil and gas giant become a direct energy provider to 825,000 British homes and compete with the so-called Big Six providers.
Shares in Dixons Carphone climbed 4.5p to 198p amid a management reshuffle that will see its deputy chief executive Andrew Harrison take up the role as chairman.
Boss Seb James signalled earlier this month that plans are under way to shake up the division, pledging to reposition the arm to deliver a “simpler, less capital-intensive business”, as the firm looks to arrest declining phone sales.
Retirement home builder McCarthy & Stone plunged 16.1p to 153.6 after admitting it would be hit by the Government’s new clampdown on unnecessary leaseholds and ground rent charges.
It comes after Communities Secretary Sajid Javid said it was unacceptable for home-buyers to be exploited by unfair practices, and announced a ban on the sale of new-build leasehold homes.
News that Dunelm had appointed a new chief executive failed to prop up the homeware retailer’s share price, which fell 12.5p to 681.5p.
Nick Wilkinson will take up the role in February after previous boss John Browett stepped down earlier this year for “personal reasons”.
The biggest risers on the FTSE 100 were Mediclinic International up 43p at 630p, NMC Health up 79p at 2,817p, Next up 122p at 4,415p, and Standard Life Aberdeen up 10.6p at 428.7p
The biggest fallers on the FTSE 100 were Carnival down 86p at 4,878p, United Utilities down 11p at 815p, Berkeley Group Holdings down 40p at 4,170p, WPP 11p at 1,342p.