In a landmark moment for the City of London, the UK's premier share index, the FTSE 100, has smashed through the 10,000-point barrier for the first time in its history. The blue-chip benchmark soared to a record high of 10,046 points during Friday trading, capping off a spectacular year for British equities.
A Stellar Year for the Footsie
The historic breakthrough marks the culmination of a remarkable 12-month period for the index, often nicknamed the 'Footsie'. Over the course of 2025, the FTSE 100 delivered a staggering total return of 21.5%. The final push past the symbolic 10,000 level was fuelled by a traditional late-year 'Santa Claus rally', a period spanning the last five trading days of the old year and the first two of the new where shares often climb amid lighter trading volumes.
Leading the charge on Friday were engineering giant Rolls-Royce, aerospace firm Melrose, and precious metals producer Fresnillo, each posting gains of around 3%. Dan Coatsworth, head of markets at stockbroker AJ Bell, hailed the achievement: "The FTSE 100 hit the 10,000 jackpot level immediately after rounding off a tremendous year for UK shares." He added that the milestone serves as powerful evidence to sceptics that "the UK market is not stuck in the mud, and that the US stock market is not the only place to make money."
Global Winds Lift London's Market
The rally in London helped propel the pan-European Stoxx 600 to its own record peak, with mining and energy sectors leading gains. The FTSE 100's surge is part of a broader global uptrend over the past year, driven by optimism over potential central bank interest rate cuts, the transformative boom in artificial intelligence, and a generally supportive economic backdrop.
Market dynamics in 2025 were also shaped by geopolitical factors. An initial wobble occurred last April when former US President Donald Trump announced steep tariffs on trading partners, but shares subsequently recovered as trade war tensions eased. This uncertainty, however, encouraged some investors to diversify away from US markets and seek value in cheaper alternatives like the UK.
Certain sectors shone particularly brightly. Fresnillo emerged as the FTSE 100's top performer in 2025, skyrocketing approximately 450% on the back of soaring gold and silver prices. Defence stocks also enjoyed a banner year, with companies like Babcock and Rolls-Royce doubling in value since January 2025.
Neil Wilson, an investor strategist at Saxo UK, noted: "Defence names really stand out globally one year into President Trump’s presidency. In Europe, his pressure on Nato members to take greater responsibility for their own defence spending has triggered a paradigm shift in how the continent views security."
From 1,000 to 10,000: A Market Evolution
Established in 1984 with a base level of 1,000 points, the FTSE 100 has evolved into a bellwether for the UK economy with a strong international flavour. Its constituents, the 100 most valuable companies listed on the London Stock Exchange, include global mining titans like Rio Tinto and Anglo American, oil majors BP and Shell, pharmaceutical leaders AstraZeneca and GSK, and banking giants such as Barclays, Lloyds, HSBC, and NatWest.
Looking ahead to 2026, optimism appears to be holding firm. A recent poll by trading platform eToro found that 53% of UK retail investors are confident the current bull market will continue throughout the new year. While some analysts express caution over potentially bubbly AI company valuations, the prevailing sentiment suggests global markets, including London's, may have further room to run.
