Key Points
- The FTSE 100 closed at a record high of 10,341.56 on Monday, up 118.02 points or 1.2%, with an intra-day peak of 10,345.48.
- London’s blue-chip index shrugged off a sharp meltdown in metals prices, including gold dropping to $4,696.11 per ounce from $5,003.82, silver falling 6.4%, and copper easing 1.3%.
- Defensive sectors led gains: healthcare up with AstraZeneca rising 3.2% or 440p to 14,040p, GSK up 2.6%; Unilever up 2.2%; financials and pharma outperforming amid global selloff.
- Mining stocks declined: Endeavour Mining down nearly 5% or 112p to 4,110p, Fresnillo down 4% or 34p to 3,668p, Antofagasta down 3.3% or 0.2%, Glencore and Rio Tinto down 2% and 1%.
- Trigger for metals rout: US President Donald Trump’s nomination of Kevin Warsh as Fed chair on Friday, unwinding leveraged bets, boosting dollar, and cooling precious metals rally.
- FTSE 250 up 0.74% or 172.69 points to 23,426.05; European peers Cac 40 up 0.7%, Dax up 1.1%.
- Positive UK data: S&P Global manufacturing PMI at 17-month high of 51.8; house prices up 1.0% y/y per Nationwide; business confidence at eight-month high.
- Top risers: JD Sports Fashion up 5.0p to 86.7p, InterContinental Hotels Group up 5.6p to 140.4p, IAG up 15.0p to 433.2p, Beazley up 35.0p to 1,168p.
- Oil prices fell: Brent crude to $66.03/barrel from $69.76, dragging BP down 0.4%, Shell 0.5%.
- Pound at $1.3651 vs $1.3719; US 10-year Treasury yield at 4.28% from 4.25%.
- Analyst views: Barclays on gold volatility but persistent drivers; JPMorgan bullish long-term; Deutsche Bank targets $6,000/oz; Morgan Stanley links to Warsh nomination.
- Bank of England expected to hold rates at 3.75% Thursday, with signals for later cuts.
- Other movers: Experian up 3% on $1bn buyback; Anglo American up 1.2% on Citi upgrade; Airtel Africa down 7% post-Q3.
- Earlier session: FTSE at 10,203 up 0.5% Friday, shrugging off Trump Fed pick, Iran attack, dollar volatility.
FTSE 100 surges to record highs despite metals sector plunge, driven by defensive stocks and robust UK economic signals.
London’s premier stock index, the FTSE 100, achieved a historic milestone on Monday, closing at an all-time high amid a turbulent backdrop of plummeting metals prices. Investors rotated into safer havens like pharmaceuticals and consumer goods, offsetting heavy losses in commodity-linked shares. This resilience underscores broader market confidence bolstered by positive domestic data.
Why did the FTSE 100 hit a new record high?
The FTSE 100 closed up 118.02 points, or 1.2 per cent, at 10,341.56, marking a record close and nearing an intra-day high of 10,345.48, as reported in coverage from Ireland Live contributed by Alliance News. Similarly, Share-Talk noted the index ended up 1.15 per cent at 10,341.56, having touched 10,345 intra-day, extending its strong run. Reuters highlighted that the UK’s FTSE 100 closed at a record high as financials and defensive pharma stocks outweighed the slide in commodity-linked shares.
As reported by Dan Coatsworth, head of markets at AJ Bell, in UK Investor Magazine, “It’s a potentially big day for financial markets amid chatter that Donald Trump will announce his pick for the new Federal Reserve chair.” Reports confirmed US President Donald Trump’s Friday nomination of Kevin Warsh, perceived as an orthodox choice preserving Fed independence, which triggered a dollar rebound and metals unwind.
What caused the metals meltdown?
Precious and industrial metals suffered sharp declines, with gold quoted at $4,696.11 per ounce on Monday, down from $5,003.82 late Friday, after peaking near $5,600 earlier, per Ireland Live. Silver plunged a further 6.4 per cent, while copper eased 1.3 per cent, though both rallied from session lows. UK Investor Magazine detailed gold momentarily falling below $5,000 before rebounding to $5,134, with silver and other metals hit by dollar strength.
Strategists at Barclays, as cited in Ireland Live, stated: “The volatility has been extreme, positioning is stretched, and short-term technicals look overheated – but it seems that the broader drivers behind the move remain powerful and persistent. Whilst gold’s allure still glitters as a hedge to left-tail risks, in the short term, a pull-back and positioning reset after its sharp ascent look warranted. We believe that the underlying bid for the asset will remain at lower levels.” Barclays added that despite screens flashing “overvalued”, a premium to gold’s fair value of $4,000 per ounce looks “durable, suggesting gold is not a bubble”. They noted: “Inflation continues to push gold’s fair value higher, and central bank demand remains firm. Add mounting concerns around policy credibility and fiat stability, and the backdrop supports elevated pricing.”
JPMorgan, per Ireland Live, believes the sell-off was partly driven by derivatives markets activity, exacerbating volatility and catalysing negative rebalancing, but sees the pull-back “as an opportunity and remain firmly bullish long term on gold”. Deutsche Bank Research reiterated its $6,000 per ounce gold price target. Morgan Stanley, as quoted in Ireland Live, said: “The nomination of Kevin Warsh as Federal Reserve chairman on Friday played a part in the market volatility. While the administration favours a weaker dollar to support competitiveness and reduce trade imbalances, the pace of the recent move was likely undesirable. Warsh’s reputation as a balance sheet hawk is seen as a credibility anchor, helping to cool gold prices and modestly support the dollar-buying time for broader policy objectives to play out as designed.”
Which stocks led the FTSE 100 gains?
Defensive plays dominated, with the healthcare sector gaining 1.3 per cent, boosted by AstraZeneca up 1.4 per cent or 3.2 per cent/440p to 14,040p, per Reuters and Ireland Live. GSK rose 2.5 per cent or 2.6 per cent. Unilever climbed 2.2 per cent, a key contributor, as noted by Reuters. Personal care and financials also advanced amid economic slowdown fears.
The biggest risers on the FTSE 100 were JD Sports Fashion, up 5.0p at 86.7p; InterContinental Hotels Group, up 5.6p at 140.4p; International Consolidated Airlines Group (IAG), up 15.0p at 433.2p; AstraZeneca, up 440.0p at 14,040.0p; and Beazley, up 35.0p at 1,168.0p, according to Ireland Live contributed by Alliance News. Experian surged 3 per cent as the top riser on Friday after a $1bn share buyback, as detailed by Aarin Chiekrie, equity analyst at Hargreaves Lansdown, in UK Investor Magazine: “UK-based data and tech company Experian announced a new $1bn share buyback program this morning, commencing immediately. That’s clearly in response to its roughly 20% share price decline year-to-date as the baby’s seemingly been thrown out with the bathwater, on fears of increased competition. Underlying trends at the business remain strong, so this looks like an opportunistic way to create value for current shareholders.” HSBC and AstraZeneca were up around 1 per cent each on Friday, per UK Investor Magazine.
Anglo American bucked the mining trend, rising 1.2 per cent after Citi upgraded it to “buy” from “neutral”, calling its proposed merger with Teck Resources to form AngloTeck “transformative”.
Which mining and commodity stocks fell hardest?
The precious metals miners index fell 4 per cent to a three-week low, with Endeavour Mining and Fresnillo down nearly 5 per cent or 2.7 per cent/112p to 4,110p and 0.9 per cent/34p to 3,668p, per Reuters and Ireland Live. Antofagasta lost 3.3 per cent or 0.2 per cent, Fresnillo 4 per cent earlier, UK Investor Magazine reported. Glencore and Rio Tinto fell 2 per cent and 1 per cent. Biggest fallers included Endeavour Mining down 112.0p at 4,110.0p, BAE Systems down 52.0p at 1,922.0p, Autotrader down 6.2p at 531.8p, Fresnillo down 34.0p at 3,668.0p, and Melrose down 4.8p at 621.2p. Airtel Africa sank 7 per cent post-Q3, per UK Investor Magazine.
Oil dragged energy: Brent at $66.03/barrel from $69.76, BP down 0.4 per cent, Shell 0.5 per cent.
How did broader markets and data influence the FTSE?
The FTSE 250 rose 0.74 per cent or 172.69 points to 23,426.05, while AIM All-Share fell 0.4 per cent to 814.34. Trading Economics noted a 0.7 per cent rise to above 10,300 early, with defensives like British American Tobacco up 1.5 per cent.
UK data supported optimism: S&P Global UK manufacturing PMI jumped to 51.8, a 17-month high from 50.6, with job cuts weakest since losses began 15 months ago and 58 per cent of manufacturers expecting output growth. Nationwide house prices rose 1.0 per cent y/y from 0.6 per cent, beating 0.7 per cent consensus. Business confidence hit an eight-month high.
The pound stood at $1.3651 from $1.3719; US 10-year yield at 4.28 per cent from 4.25 per cent, 30-year at 4.90 per cent from 4.85 per cent.
Tom Stevenson, investment director at Fidelity International, as quoted in Ireland Live, said the precious metal “rout” provides a nervous environment for markets in a big week for central banks. “Both the Bank of England and European Central Bank announce rate decisions on Thursday. Both are expected to leave rates on hold. The Bank of England is widely forecast to hold rates at 3.75%, with a majority of rate-setters focused on elevated wage growth and just a couple of dissenters pushing for a further cut in the cost of borrowing to support the economy. Despite this, the Bank will probably signal further cuts later in the year as policies introduced in the budget weigh on prices and the impact of a stronger pound feeds into the economy.”
Earlier Friday, UK Investor Magazine reported the FTSE 100 up 0.5 per cent at 10,203, shrugging off Trump’s Fed pick, an attack on Iran, and dollar volatility.
What are the implications for investors?
This record run reflects market rotation to defensives amid commodity volatility, with UK data adding tailwinds. For professionals navigating such dynamic Financial Markets, mastering trading strategies through targeted training can sharpen decision-making in volatile environments.