FTSE 100 Reaches Record High Amid Inflation Cooldown and Metal Surge

The FTSE 100 hit a new peak as cooling inflation fueled hopes of a rate cut by the Bank of England, with miners leading gains. The index rose 1.2%, while commodities and monetary easing expectations bolstered UK equities. Despite AI concerns, strong performances lifted investor sentiment.

The FTSE 100 in London achieved a fresh record high, closing up 1.2% at 10,686.18 points, following signs of slowing inflation that boosted expectations for a Bank of England rate cut anticipated as early as March. This marked the second consecutive day of record highs for the index.

Among the top performers were London-listed miners like Antofagasta and Anglo American, which surged on higher copper and metal prices, while Glencore saw a 4.4% gain after a shareholder payout announcement. The energy and metals sectors are proving lucrative as UK stock valuations remain attractive compared to U.S. counterparts, according to IG analyst Axel Rudolph.

The rise in commodity stocks, alongside strong earnings and potential monetary easing, helped UK equities recover from a previous AI-driven market selloff. With inflation at its lowest in nearly a year and a weakened sterling, investor confidence remains strong, propelling the FTSE 100 closer to the 11,000 mark.