FTSE 100 continues its ascent as sentiment improves

The FTSE 100 started the week off on the front foot with more gains for London’s leading index as sentiment remained high after a better session in the US on Friday.

Investors will be delighted to see the FTSE 100 notch up another 0.4% gain, bringing the index within touching distance of 8,200 and another fresh record high.

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“The FTSE 100 has clearly had its Ready Brek as the blue-chip index continues to glow and sustain energy that we haven’t seen in the UK market for a long time,” said Russ Mould, investment director at AJ Bell.

After a robust earnings week last week, better-than-feared US inflation data has helped maintain the upbeat mood with more earnings are expected this week. 

“Sentiment is upbeat at the start of the week, fuelled by relief that inflationary pressures in the US aren’t as bad as feared, and hopes return that a ceasefire could be negotiated in the Middle East. The FTSE 100 has scaled fresh heights, with another sprint higher in early trade. April has been a record-breaking month for the blue-chip index, with a glass-half full sentiment dominating,” said Susannah Streeter, head of money and markets, Hargreaves Lansdown.

“The Footsie has gained more than 11% over the last six months, with super-patient investors finally rewarded by this spurt of growth.”

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Improving geopolitics is playing a part in Monday’s equity rally as tensions subside. 

“Investor optimism has been buoyed by a rally on US markets on Friday, and developments in the Middle East. Negotiators from Israel and Hamas expected to meet in Egypt, while US Secretary of State Antony Blinken ups diplomatic efforts at the World Economic Forum in Riyadh, Saudia Arabia,” Streeter said.

Anything positive from the Middle East is feeding directly into stocks currently because the risk premium built into oil is diminishing, which is easing inflation concerns. 

Monday’s gains were broad, with most industry sectors rising. Frasers Group was the best performer with a 2.5% gain.

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