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What is behind the FTSE 100’s big comeback?
The FTSE 100 has been racing away since its most recent low point in late March. It has surged back above the 7,500 mark and is within striking distance of the previous record close of 7,778 on 12 January 2018.
It has advanced by nearly 10% on the 26 March closing level of 6,889. In doing so it has outperformed several of its global peers like the S&P 500 which is up by a mere 0.5%, and the Nikkei 225 which is trading 8.4% higher.
A key factor in this outperformance, particularly in recent weeks, has been a decline in sterling amid continuing ructions over Brexit and weak UK growth figures.
A fall in the pound increases the relative value of its constituents’ overseas earnings. The 10 May interest rate decision from the Bank of England could be a key factor in determining whether the FTSE reaches new all-time highs in the short-term given the influence rates have on currency markets. (TS)