Key Takeaways
- UK blue-chip shares extended a strong 2025 rally into the first trading day of 2026.
- Defense, financial, and mining stocks have helped the UK stock market.
- The UK index last broke through a key level in July 2025, closing above 9,000 points.
The FTSE 100 hit another high on the first trading day of 2026, surpassing the 10,000 points mark. The index was driven above this milestone by mining, aerospace and defense stocks, with Fresnillo FRES, Rolls-Royce RR., Melrose Industries MRO, and Babcock International BAB, and BAE Systems BA. among the top-five risers.
The index had previously broken through the 9,000 mark on July 15, 2025. While the FTSE 100 has yet to close above 10,000 points, this is the first time that this level has been breached within a trading day.
“Breaking through the 10,000 level is the best New Year’s present chancellor Rachel Reeves could want,” says AJ Bell head of markets, Dan Coatsworth.
“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.”
Why Is the FTSE 100 Hitting Record Highs?
The FTSE 100 had an impressive 2025, with the UK blue-chip index rising more than 20%, beating the US flagship index, the S&P 500, which posted gains of 16.65% across the year. A strong year for banks and natural resources stocks, with gold and silver prices hitting new records, also supported UK share prices.
That came despite the global economic disruption caused by the US government’s launch of tariffs in April 2025.
Despite a year of sticky inflation and lacklustre gross domestic product growth, in 2025 the UK’s FTSE 100 benefited from a political push across Western Europe for stronger defence infrastructure in the face of perceived US isolationism and questions over NATO funding. That drove UK defense stocks to record strong gains. Babcock International rose 146.63% in 2025, while Rolls-Royce gained 95.45%. Shares in BAE Systems increased by nearly 50%.
“Lots of people have criticized 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,” says AJ Bell’s Coatsworth.
“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.”
The FTSE 100’s success is also mirrored in the performance of the Morningstar UK Index, which has doubled over five years. By sector, financial services, consumer defensive, and industrials are the index’s biggest exposures.
FTSE 100 Technical Analysis: The Long Road to 10,000 Points
The FTSE 100 index launched in 1984 with a starting level of 1,000 points and has risen more than 600% since then. For comparison, the Dow Jones Industrial Average is up more than 3,000% over a similar period.
The journey to 10,000 points has been a slow grind for UK index investors. A lot of external factors have intervened, including the dotcom boom and bust, global financial crisis, Brexit, the pandemic and, most recently, tariff turmoil of April 2025.
From a technical analysis point of view, for many years the FTSE 100 seemed stuck between 6,000 and 7,000 points, which represent key “support” and “resistance” levels.
The following months represent important milestones on the FTSE 100’s journey to 10,000:
- 6,000 points first breached in April 1998
- 7,000 points hit in March 2015
- 8,000 points in February 2023
- 9,000 points in July 2025
- 10,000 points in January 2026
James Gard contributed to this story.
