Since mid-October, the FTSE 100 Index (INDEXFTSE: UKX) has been on a roll, constantly rising and setting a new record high. As of this writing, it is trading at 9,673 points. There are many reasons behind this long rise, and hints that investors are finally paying attention to the UK’s economy benchmark.
The fundamental reason for the current rise is that the market believes that central banks will become more dovish. After a US inflation data that was softer than predicted, many in the market are more sure than ever that the Bank of England will lower interest rates at its November 6 meeting. The possibility of cheaper borrowing costs and more economic activity has caused an “investing frenzy,” which is good for the FTSE 100.
Another important reason is that oil companies like BP and Shell have been doing well. That momentum started after the US and EU put stricter sanctions on Russia, which has tightened the global supply of oil. Consequently, oil prices are rising and earnings in the energy sector are rising. The outlook has also improved because of strong corporate earnings, including NatWest upping its guidance and improving its financials.
The forecast for the near future looks good. Analysts see a push toward 10,000 by Christmas if trade talks go well and earnings keep coming in. These are strong buy signals across the board. A less strict policy from the Bank of England might boost prices even further, especially for banks and miners that are already undervalued.
The FTSE 100 chart is quite upbeat. It recently broke out to an all-time high of 9,645.62 and is still above the 20-day SMA of 9,475 points. The most important supports are at 9,565 pivot, 9,474, below which a reversal could come into play, potentially testing 9,348 points.
On the other hand, the main resistance level is at 9,696. If it breaks over that level, the resulting momentum could test 9,800. However, the RSI at 69.49 shows that the market is overbought, which could lead to a cooldown.
The key macro data at play include upbeat UK economic data, including positive corporate earnings like NatWest’s, which has raised optimism. This indicates a potential improvement in the UK economy.
Rising crude prices from Russia sanctions have tightened supply and lifted BP and Shell stocks, fueling the FTSE’s rally with gains by the energy sector.
Some analysts estimate that it could hit 10,000 points by year-end if trade talks and earnings hold. That outlook is also boosted by potential BoE rate cuts.
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This post was last modified on Oct 27, 2025, 15:51 GMT 15:51