FTSE 100 bursts through 10,000 for first time – Daily Business

London’s first trading session of the New Year has delivered a new record high for the FTSE 100 which has burst through the 10,000 level for the first time.

The breakthrough came half an hour after the Stock Exchange opened for business and the index peaked in early trade at 1046.25.

Part of the reason for the surge is investors fearing overvalued tech stocks, particularly in the US, and looking for bargains which they can find in London’s undervalued market.

There has also been a rush to buy stocks in defence stocks which feature strongly in the top 100 list.

Shares in Babcock International, the defence company, surged by 148% over 2025 and engineering group Rolls-Royce more than doubled, while Fresnillo, Endeavour Mining, Lloyds Bank, Barclays and Standard Chartered were also among the biggest risers.

Hitting the 10,000 level this year represents the fastest rise between 1,000 intervals ever for the blue-chip index.

The top flight index closed on New Year’s Eve 9.33 points, or 0.09%, lower at 9,931.38, but has risen 21.5% over the year. It was its best year since recovering from the financial crisis in 2009.

Its annual gain is more than twice what it achieved in 2024 and ahead of the 17.2% from the S&P 500 index in the US.

“It’s time to break out the champagne as UK stock markets have delivered a New Year’s treat,” Dan Coatsworth, head of markets at AJ Bell.

“The FTSE 100 hit the 10,000 jackpot level immediately after rounding off a tremendous year for UK shares. This is a historic moment and already makes 2026 one of the most significant years for the blue-chip index since its launch in 1984.

“Breaking through the 10,000 level is the best New Year’s present Chancellor Rachel Reeves could want. She has been banging the drum about the merits of investing over parking cash in the bank, and the FTSE 100’s achievements just go to show what’s possible when buying UK shares.

“It also proves to cynics that the UK market is not stuck in the mud, and that the US stock market is not the only place to make money.”

He added: “When everything looks gloomy or chaotic, such as in the depths of the Liberation Day [higher tariffs] fallout, investors often seek solace in companies whose goods and services should be in demand no matter what’s happening in the world.

“We all need to pay insurance or water bills, or those in the habit are still likely to buy cigarettes or vapes, and the FTSE 100 has plenty of companies playing on these themes on offer.”

There have been other tailwinds for the FTSE 100 over the past year including the sharp rise in the price of gold and silver which has benefited the likes of Fresnillo and Endeavour Mining,” he said.

“Lots of people have criticised the UK for being an old economy market, full of boring companies in the banking and natural resources sector. Yes, it lacks the excitement of go-go-growth stocks omnipresent in the US, but boring can also be beautiful when it comes to investing.

“The UK is a rich hunting ground for dividends, and it is also full of companies that have slow but steady growth and which are underappreciated engines for wealth creation.

It has taken just 171 days since the FTSE 100 hit 9,000, so exceeding 10,000 at the start of 2026 makes it a record-breaking leap. Previously, the fastest jump in blocks of 1,000 happened when the FTSE 100 went from 5,000 to 6,000, which took 229 days in the late 90s.

The longest period was 6,206 days between hitting 6,000 in March 1998 and 7,000 in 2015. Admittedly, that period included a global financial crisis, so it was unusual times.