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The FTSE 100 index surpassed the 10,000-point milestone for the first time in its history on the opening trading day of the year, marking a notable achievement in the stock market. The index had already posted substantial gains throughout 2025, ending the year more than 21% higher than its position at the start, when it was just above 8,260 points. It briefly hit a new high at 10,046 points, before retreating slightly to below the 10,000 mark.
Throughout 2025, the London stock market outperformed several major American indices, despite ongoing concerns about overvaluation in the US tech sector. British firms such as Currys and Next experienced significant uplifts in their share prices, alongside strong performances by companies involved in precious metals mining, defence, and financial services. This diverse mix contributed to the overall positive momentum of the FTSE 100.
The FTSE 100 index measures the performance of the 100 largest companies listed on the London Stock Exchange. While a rise in the index benefits investors, including pension holders and those with market-linked savings, it does not directly reflect the UK economy’s health. Many companies listed have substantial international operations, with about three-quarters of their revenue coming from overseas. For instance, rising gold and silver prices supported mining companies like Rio Tinto, and increased global defence spending benefited contractors such as Babcock and Rolls-Royce amid ongoing geopolitical tensions and economic uncertainties.
After resuming trading post-New Year holidays, the FTSE 100 hit an intraday record, surging over 1% to reach 10,046 points within the first hour of trading. However, by midday it had slipped back below this threshold to 9,981.21 points. Susannah Streeter, an independent financial commentator, described this milestone as “psychologically important” and a sign that the London blue-chip index had regained investor favor. She noted, “Concerns continue to swirl about the super-high valuation of US tech sector,” suggesting that these concerns contributed to the UK market’s renewed appeal. Dan Coatsworth, head of markets at investment platform AJ Bell, viewed crossing the 10,000 mark as a positive sign aligned with Chancellor Rachel Reeves’s calls for greater investment in UK equities to support economic growth, stating, “The FTSE 100’s achievements just go to show what’s possible when buying UK shares.” Coatsworth also highlighted how the FTSE 100’s varied industries, including mining and banking, offer stability to investors during uncertain times, emphasizing the consistent demand for essential goods and services represented in the index.
The Chancellor welcomed the FTSE 100’s breakthrough as “a vote of confidence in Britain’s economy and a strong start to 2026.” Despite the index being dominated by large multinational companies and reflecting global business conditions more than the domestic economy, it closed 2025 at 9,931 points after numerous record highs during the year. The index’s rise mirrors a wider global stock market trend fueled by investor optimism around artificial intelligence (AI) and its potential to enhance corporate earnings, though experts caution that if AI’s benefits do not materialize as anticipated or soon enough, investor enthusiasm may wane, risking a sharp decline in share prices. Among the best-performing companies in 2025 were fashion retailer Next, which raised its profit forecasts multiple times, and Burberry, which returned to profitability following consecutive years of losses. Conversely, companies like Greggs, Diageo, and WH Smith saw notable share price declines due to concerns over expansion strategies and sluggish sales growth
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