Britain’s benchmark share index, the FTSE 100, closed at an all-time high for a second consecutive day on Thursday, as UK stocks continue to soar on the back of the weak pound.
Despite the new record, it was actually a spectacularly uneventful day in the markets and the record was achieved thanks to a gain of just 0.2%, or roughly 14 points.
On Wednesday, the index closed at 7,106.08, surpassing the previous high of 7,103.98 points achieved in April 2015. Thursday’s new closing high was 7,120, according to data from Google Finance.
Trading volumes on Thursday were incredibly thin with the majority of City traders enjoying time-off in the week between Christmas and New Year.
Roughly 245 million shares traded across all the companies on the index on Thursday, while the FTSE’s average over the past three months has been just shy of 900 million. Regardless, an all-time high is an all-time high.
Here’s the chart showing the FTSE’s new peak: UK stocks have taken off since the vote for Brexit, gaining more than 15% since the days before the referendum. This may seem like fantastic news for the British economy, but it has largely been driven by the weakness of the sterling since June 23rd.
Though a weaker pound might seem like bad news for UK stocks, about 70% of the revenue earned by the companies that make up the FTSE 100 is derived abroad, meaning they make more money when sterling is weak. The index is full of mining companies, oil firms, and pharmaceutical giants that use the UK as a base but tend to denominate their assets in dollars. Exporters also prefer a weak pound: It makes their goods cheaper than international competitors.
The FTSE is yet to break past its intraday record, which was broken earlier in 2016. At lunchtime on October 11, the index hit 7,128 points, surpassing its previous intraday high of 7,123.
Elsewhere in Europe, stocks also saw lower than normal levels of trading, with most major bourses closing trade in negative territory. Here’s the scoreboard: