Skyrocketing Stocks: FTSE 100 Breaches Historic 10,000 Point Barrier!

The FTSE 100 index has officially crossed the 10,000 points threshold for the very first time, a historic stock market achievement marking the start of 2026. This significant milestone comes after shares included in the index showed strong performance throughout 2025, with the benchmark gaining over 21% from just above 8,260 points last year. It peaked at an all-time record of 10,046 points before retracting to close at 9,951 on the same day.

Despite widespread discussions about high stock valuations in the US markets, the London index outperformed major American indexes in the past year. British firms like Currys and Next experienced substantial gains, along with companies in the precious metals, defence, and financial services sectors.

The FTSE 100 reflects the performance of the 100 largest companies on the London Stock Exchange but does not serve as a direct gauge of the UK economy; about three-quarters of its revenue comes from international operations. Entities such as Rio Tinto benefitted from rising gold and silver prices, while increasing global defence budgets boosted contractors like Babcock and Rolls-Royce amid a backdrop of economic uncertainties.

According to financial commentator Susannah Streeter, the 10,000-point mark is a crucial psychological milestone, indicating that London’s blue-chip index is regaining investor favor. Meanwhile, Dan Coatsworth, from investment platform AJ Bell, highlighted the milestone as a significant New Year’s boon for Chancellor Rachel Reeves, who advocates for increased investments in UK shares to stimulate economic growth. He noted that while London companies might be perceived as “old and boring,” their diverse industry representation offers stability that attracts investors during uncertain times.

As Chancellor Reeves remarked, the FTSE’s breakthrough demonstrates confidence in Britain’s economy. Despite its origins, the index reflects wider global business trends, particularly the surging expectations surrounding artificial intelligence (AI) improving earnings. However, analysts caution that if these high anticipations for AI do not materialize swiftly, it may result in a significant drop in share values.

Notable performers in 2025 included Next, which continually raised its profit outlook, and luxury brand Burberry, which returned to profitability after previous losses. Contrastingly, the bakery chain Greggs saw its shares plummet by 39% due to concerns over expansion strategies and lackluster sales growth, alongside similar declines faced by Diageo and WH Smith.