FTSE 100 closes above 9,000 for the first time as global markets reach new peaks

​​​Historic closing caps remarkable FTSE 100 recovery

​The FTSE 100 achieved a historic closing above 9,000 points for the first time in its 41-year history yesterday, finishing very slightly above this landmark level. This represents a significant psychological and technical milestone for Britain's benchmark index, marking remarkable progress from the 8,000 level which was only surpassed last year.

​The achievement highlights the resilience of UK equities despite ongoing economic challenges and political uncertainty. Major constituents including energy giants, banks, and consumer staples have all contributed to this steady climb throughout the year.

​UK corporate developments drive market confidence

​Several significant corporate announcements have supported the positive sentiment surrounding UK markets. Centrica confirmed its agreement to take a 15% equity stake in the proposed Sizewell C nuclear project, committing £1.3 billion in construction funding alongside the UK government's 44.9% stake.

​This investment represents a major endorsement of Britain's nuclear energy future and aligns with the country's net-zero ambitions. The project aims to replace aging nuclear facilities while providing low-carbon electricity generation for decades to come.

​Meanwhile, AstraZeneca announced plans to invest $50 billion in the United States before 2030, focusing on manufacturing and research development. The pharmaceutical giant's commitment includes establishing a new facility in Virginia to produce its weight-loss medication.

​Activist investor Elliott has intensified pressure on BP's newly-appointed chairman Albert Manifold to address operational challenges at the oil major. The investor highlighted Manifold's successful track record at CRH and called for urgent improvements to cost management and capital allocation priorities.

​Budget deficit concerns weigh on sterling

​The UK reported a budget deficit of £20.7 billion for June, representing the highest level since April 2021 and exceeding economist forecasts. Higher debt-interest payments drove the increase, with total payments reaching £16.4 billion due largely to index-linked gilt adjustments.

​Total borrowing for the first three months of the fiscal year reached £57.8 billion, approximately £7.5 billion higher than the previous year. These figures are likely to fuel speculation about potential tax rises later this year to shore up public finances.

​The borrowing increase reflects broader economic pressures facing the UK government as it balances infrastructure investment needs against fiscal responsibility. Interest payments on government debt continue to rise, creating additional constraints on public spending flexibility.

​Sterling weakened against major currencies following the deficit announcement, with investors expressing concern about the sustainability of current borrowing levels. The pound's decline may provide some support for FTSE 100 exporters but raises questions about imported inflation pressures.

​US markets maintain record-breaking momentum

​Across the Atlantic, US equity markets continued their record-breaking run, with the S&P 500 and Nasdaq 100 touching fresh all-time highs. Alphabet led the charge among megacap technology stocks, rising 2.7% ahead of its quarterly earnings announcement.

​The Magnificent Seven group of technology giants once again drove broader index performance, with Apple and Amazon contributing meaningfully to overall gains. This concentration continues to raise concerns about market breadth, though technical indicators suggest improving participation beyond the largest stocks.

​Verizon provided a notable bright spot outside the technology sector, surging over 4% after raising its annual profit forecast. The telecommunications company's guidance upgrade suggests its 5G infrastructure investments may finally be generating improved returns for shareholders.

​However, looming tariff threats continue to create uncertainty, with the 1 August deadline for potential 30% import duties weighing on trade-sensitive sectors. Companies are facing increased scrutiny during earnings calls about potential supply chain disruptions and cost implications.

​Federal Reserve independence under pressure

​Growing speculation about potential changes to Federal Reserve (Fed) leadership has emerged as another source of market volatility. Reports suggest the incoming administration may consider replacing Chairman Jerome Powell, raising questions about central bank independence and future monetary policy direction.

​Powell's scheduled speech this week will be closely monitored for any commentary on political pressure or policy stance changes. Historical precedent suggests markets react poorly to perceived threats to Fed independence, potentially creating significant trading opportunities for positioned traders.

​The uncertainty comes at a critical time as markets weigh inflation concerns against growth prospects. Any undermining of Fed credibility could have far-reaching implications for US dollar strength, bond yields, and global equity valuations.