FTSE 100 on track for best month since first US attacks on Iran five months ago – as it happened

The FTSE 100 index is poised to record its best month in nearly five years, with a gain of over 4% expected by the end of trading today. This follows a surge in global markets, driven by improved investor sentiment and a weakening pound.

Stocks have been rising steadily since the start of the week, with many major companies reporting strong earnings and outlook statements. The index has also benefited from a decline in bond yields, which has made equities more attractive to investors.

The Bank of England’s decision to raise interest rates last month is seen as a contributing factor to the recent market rally. Higher borrowing costs have reduced demand for bonds, pushing up their prices and making equities look relatively cheap.

Investors are also optimistic about the UK economy, which is expected to grow at its fastest pace in nearly a decade this year. The Chancellor’s budget statement last week laid out plans for increased spending on infrastructure projects, which has boosted confidence among investors.

The pound, meanwhile, has fallen to a new low against the dollar, making imports more expensive and contributing to higher inflation expectations. However, the weaker currency is also benefiting UK exporters, who are seeing increased demand for their products abroad.

FTSE 100 companies such as HSBC and BP have reported strong earnings growth in recent weeks, driven by improved commodity prices and a recovery in global trade. The index has also been boosted by the performance of smaller-cap stocks, which have outpaced larger companies in recent months.

The rally in global markets is being led by the US, where the S&P 500 index has risen over 5% in the past month. European indices, including the FTSE 100, are following closely behind, driven by improved investor sentiment and a weakening euro.

Investors are also taking advantage of low bond yields to invest in equities, which have historically provided higher returns over the long term. The recent surge in stock prices has been fueled by a combination of factors, including improving economic data and a weakening pound.

The FTSE 100 is now trading at its highest level since July last year, when it peaked at around 7,800 points. Today’s expected gain would mark the index’s best month since August 2019, when it rose over 5% following the first US attacks on Iran five months earlier.

In a statement, one analyst noted that “the market is currently in a sweet spot, with improving economic data and a weakening pound driving investor sentiment.” Another expert added that “investors are taking advantage of low bond yields to invest in equities, which have historically provided higher returns over the long term.”

The rally in global markets is being closely watched by investors, who are waiting for further signs of improvement in the economy. The Bank of England’s next interest rate decision is due on March 17, and investors will be looking for any clues about future policy changes.

As the market continues to rise, investors are left wondering whether the rally can sustain itself over the long term. While some experts predict a continued surge in stock prices, others warn that the current bull run may be unsustainable.