London’s FTSE 100 edged closer to an all-time high on Friday as investors continued to be buoyed by expectations that interest rate cuts are looming.
The index of the UK’s top 100 stocks hit highs of 7,960 during the day, but did not manage to surpass the 8,000 mark.
It last reached a record in February last year amid hopes that the UK could skirt a recession and global central banks would halt interest rate hikes.
The FTSE 100 closed 48.37 points higher, or 0.61%, to 7,930.92 on Friday.
Kathleen Brooks, research director at trading platform XTB, said: “The market rally this week was driven by news that central banks have shifted to a more dovish stance.
“At the Bank of England, Catherine Mann and Jonathan Haskel, the two remaining hawks at the Bank who had been voting for more rate hikes, changed their tune and opted for rates to remain on hold this month.
“The dovish shift in the Bank vote split is seen as a major step towards cutting rates later this year. The market now thinks that the first rate cut will come in June, and that there will be three rate cuts this year.”
Banking and finance stocks were among those helping to pull up the FTSE 100, as well as gains for consumer goods giants including Reckitt Benckiser.
It was a mixed session for other stock markets around the globe. Germany’s Dax was up 0.14% and France’s Cac 40 was down 0.34% at close.
Over in the US, the S&P 500 was relatively flat while Dow Jones was down 0.5% at close.
The pound had another bruising session against the US dollar, moving down 0.5% to 1.259.
In company news, shares in Wetherspoon shares fell despite the pub group revealing that its profit surged by almost eight-fold for the latest year, with sales rising in recent weeks.
The company has continued to trim the size of its pub estate and currently has 814, but said it believes it has the “potential” to reach 1,000 sites across the UK. Shares in Wetherspoon were down 6.3% at close.
Aston Martin said it had poached the boss of luxury car rival Bentley to become its next chief executive.
The car maker will see Adrian Hallmark take on the role by October 1 this year at the latest.
Its chairman said the business was nearing the completion of a “thrilling new product portfolio”, as it moves forward with the production of its new Valhalla supercar. Aston Martin’s share price was 1.5% higher at close.
The biggest risers on the FTSE 100 were Phoenix Group, up 41p to 529.2p, Natwest Group, up 7.7p to 261.1p, Prudential, up 19.4p to 778.4p, M&G, up 5.8p to 238.8p, and Reckitt, up 106p to 4,406p.
The biggest fallers on the FTSE 100 were JD Sports, down 7.35p to 109.75p, Ocado, down 8.4p to 468.3p, Rightmove, down 9.2p to 571.2p, Frasers, down 11p to 792p, and IAG, down 2.25p to 164.45p.