FTSE 100 near record high after GDP report

FTSE 100 near record high after GDP report

The FTSE 100 has inched towards a new high after the UK economy confounded expectations and grew in November.

The index reached 7,849 on Friday (January 13), after the Office for National Statistics reported that gross domestic product in November was 0.1 per cent

The FTSE 100’s highest point was in May 2018, when it reached 7,877.45.

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Susannah Streeter, senior investment and markets analyst, Hargreaves Lansdown said investors appear to have “fallen back in love” with UK assets after a difficult period.

“Confidence has rebounded as investors eye up China’s reopening, helping commodity stocks,” she said. 

“A stronger than expected appetite from consumers has boosted the retail, travel and hospitality sectors, while banks are still riding the wave of higher interest rates.”

However, there is a risk this could be “short-lived” she said. 

“There are still niggles of worries which could blow up about ebbing consumer and company resilience in the months to come on both sides of the Atlantic. 

“US banks have set aside some hefty sums to cover the potential for bad debt to escalate if a recession rolls in. 

“With the UK housing market set to turn from a quiver to a shiver as painful rate rises start to hit, confidence may start to seep away again.”