Markets reach record highs in UK and US

Market report Perry Gourley

The FTSE 100 closed at a record level as US president Donald Trump laid out his economic stimulus ambitions, which also propelled stocks in New York to all-time highs.

Trump vowed to reform taxes, slash red tape and ramp up spending on defence and infrastructure projects in a speech which helped the UK index close up 119.46 points at 7,382.90.

It comes after the London market embarked on a remarkable winning streak at the beginning of the year – notching up 12 record closes on the bounce – as investors cheered Trump’s economic policies.

Jasper Lawler, senior market analyst at London Capital Group, said stocks in line to benefit from Trump’s proposed spending splurge were pushing the markets higher.

“A more inclusive speech from the US president has seen global stocks surge, taking the Dow Jones above 21,000 for the first time,” he said.

“There has been a lot of criticism for the lack of detail on how Trump plans to deliver his ‘don’t tax and spend’ reforms. That misses the point of the speech.

“By bringing Congress on side, Trump’s plans to ‘restart the engine’ of the US are a lot more likely to become policy.”

The FTSE 100 Index was also enjoying an uplift from the collapse in the pound, which took a substantial hit after the US dollar strengthened on market speculation that the US Federal Reserve could hike interest rates at its meeting on 15 March. Sterling’s slump since the Brexit vote has proved beneficial for multinational companies listed on the London market. The outsourcing group saw a welcome rise in its shares after the sale of two loss-making care brands to a private equity firm. The construction services group saw pre-tax profits fall by 5 per cent as it counted the cost of a restructuring exercise and job losses.