FTSE 100 hits record high after Bank of England cuts interest rates
theguardian.com — February 6, 2025, 08:01 PM UTC
The FTSE 100 reached a new closing high of 8,727, rising 1.2% after the Bank of England cut interest rates to 4.5%. This increase occurred despite a struggling UK economy, highlighting the disconnect between the stock market and economic health. FTSE 100 companies generate only 22% of their revenues in the UK, with significant earnings from North America and Asia-Pacific. A weaker pound makes dollar earnings more valuable in sterling, benefiting exporters and boosting share prices. Analysts note that UK stocks are relatively cheap compared to international markets. The FTSE 100's dividend yield of 3.4% and share buybacks make it attractive, even as concerns grow about the US tech sector's stability.