London close: Stocks mixed after FTSE 100 ekes past 10,000

2nd Jan 2026 17:32

(Sharecast News) - London stocks were mixed at the close on Friday, with the FTSE 100 ending higher despite retreating from an earlier move above the 10,000-point mark, as markets recovered from a weaker end to last year and continued to hover near record territory.

The blue-chip index rose 0.2% to 9,951.14 after touching an intraday record of 10,052, while the more domestically focused FTSE 250 slipped 0.27% to 22,409.21.

Axel Rudolph, senior technical analyst at IG, said the FTSE 100's brief move above the milestone level was "a powerful signal for UK markets, reflecting ongoing confidence in earnings resilience, attractive valuations and the growing appeal of UK equities to international investors at a time when policy headwinds are beginning to ease".

He added that while gains could become "choppier in 2026", the index remained "fundamentally supported by globally diversified earnings, strong cash generation and the prospect of a more accommodative Bank of England".

Trading volumes remained thin as many investors stayed on the sidelines over the New Year holiday, with little in the way of major corporate or macroeconomic catalysts.

Attention was already shifting to next week's data calendar, where US jobs numbers were expected to set the tone for global markets.

In currency markets, sterling edged 0.14% higher against the dollar to $1.3474 but fell 0.21% versus the euro to €1.1484.

UK manufacturing improves in December, house price growth falters

Economic data pointed to tentative improvement in UK manufacturing at the end of 2025.

The S&P Global UK manufacturing PMI rose to 50.6 in December from 50.2 in November, a 15-month high and a second consecutive month above the 50.0 expansion threshold, though below the earlier flash estimate of 51.2.

Output increased for a third straight month and new orders rose for the first time since September 2024, supported by stock building, clearing backlogs and a modest uplift in new business.

S&P Global said uncertainty linked to the Autumn Budget, tariffs and the JLR cyber-attack had eased, while output expanded across consumer, intermediate and investment goods for the first time since August 2024, led by large manufacturers.

Export orders fell for a forty-seventh month but at one of the weakest rates in that sequence, with signs of recovering demand from the US, Asia-Pacific and the Middle East.

Employment continued to fall for a 14th month, albeit at the slowest pace, while price pressures picked up as input cost inflation accelerated.

Rob Dobson of S&P Global Market Intelligence said the data pointed to "further signs of growth", though he cautioned that sustainability remained uncertain and business optimism slipped.

UK house price growth meanwhile softened further in December, with Nationwide reporting the weakest annual increase in 20 months.

The house price index slipped 0.4% on the month to 543.0, with average prices easing to £271,068, just 0.6% higher than a year earlier compared with 1.8% growth in November.

Nationwide's chief economist Robert Gardner said prices "ended 2025 on a softer note" but described the market overall as "resilient", noting that mortgage approvals remained near pre-Covid levels despite subdued sentiment and higher borrowing costs.

For the fourth quarter, prices rose 1.7%, with most regions seeing modest gains, led by Northern Ireland with 9.7% year-on-year growth, while East Anglia recorded a 0.8% annual decline.

On the continent, eurozone manufacturing weakened, with the HCOB manufacturing PMI falling to 48.8 in December from 49.6, a nine-month low, and the output index dropping into contraction at 48.9.

HCOB said new orders fell at the fastest pace in almost a year, though year-ahead optimism improved.

Chief economist Cyrus de la Rubia said firms were facing "significantly fewer orders" and continued to cut staff, but added there was hope that German stimulus and rising defence spending could support activity in 2026.

Miners and banks rise amid dearth of corporate news

In equities, miners advanced as metal prices remained elevated, with Fresnillo up 0.54% and Glencore gaining 2.53%.

Dan Coatsworth, head of markets at AJ Bell, said the FTSE 100's surge to 10,000 came "immediately after rounding off a tremendous year for UK shares", calling it "a historic moment" that already made 2026 "one of the most significant years for the blue-chip index since its launch in 1984".

He said the UK market had benefited from investors looking "away from the US for opportunities" and towards "cheaper areas of the market", adding that the FTSE 100 had "shone during the more tumultuous periods thanks to its plethora of defensive-style companies".

Banks also traded higher, led by HSBC Holdings up 1.01%, Lloyds Banking Group rising 1.69% and NatWest Group adding 0.89%.

Coatsworth noted that criticism of the UK as an "old economy market" overlooked the appeal of "slow but steady growth" and reliable income, adding that "boring can also be beautiful when it comes to investing".

Corporate news was limited, though Seeing Machines surged 13.7% after announcing a new Future Mobility Group aimed at supporting demand from the autonomous driving sector, while Invinity Energy Systems climbed 6.67% after securing two new 20MWh battery storage sales in Hungary for delivery in the first half of 2026.

Reporting by Josh White for Sharecast.com.

Market Movers

FTSE 100 (UKX) 9,951.14 0.20%

FTSE 250 (MCX) 22,409.21 -0.27%

techMARK (TASX) 5,611.19 -0.23%

FTSE 100 - Risers

InterContinental Hotels Group (IHG) 138.45p 32.36%

Rolls-Royce Holdings (RR.) 1,197.00p 4.09%

Burberry Group (BRBY) 1,319.50p 3.74%

Metlen Energy & Metals (MTLN) 45.85p 3.73%

Melrose Industries (MRO) 610.00p 3.67%

Centrica (CNA) 174.35p 2.83%

St James's Place (STJ) 1,423.50p 2.82%

Babcock International Group (BAB) 1,273.00p 2.41%

SSE (SSE) 2,231.00p 2.39%

BAE Systems (BA.) 1,754.00p 2.33%

FTSE 100 - Fallers

Coca-Cola Europacific Partners (DI) (CCEP) 6,570.00p -4.09%

The Sage Group (SGE) 1,050.00p -3.05%

Pearson (PSON) 1,019.50p -2.90%

Games Workshop Group (GAW) 18,440.00p -2.54%

Coca-Cola HBC AG (CDI) (CCH) 3,768.00p -1.93%

Auto Trader Group (AUTO) 575.40p -1.88%

DCC (CDI) (DCC) 4,544.00p -1.86%

Beazley (BEZ) 819.50p -1.80%

Hiscox Limited (DI) (HSX) 1,402.00p -1.76%

Hikma Pharmaceuticals (HIK) 1,523.00p -1.74%

FTSE 250 - Risers

Oxford Biomedica (OXB) 655.00p 6.16%

BlackRock World Mining Trust (BRWM) 835.00p 3.86%

W.A.G Payment Solutions (EWG) 109.00p 3.81%

Senior (SNR) 202.00p 3.70%

Fidelity China Special Situations (FCSS) 311.00p 3.15%

Investec (INVP) 568.50p 3.08%

AEP Plantations (AEP) 1,400.00p 2.55%

Johnson Matthey (JMAT) 2,184.00p 2.44%

Energean (ENOG) 903.50p 2.37%

Schroder Asia Pacific Fund (SDP) 673.00p 2.28%

FTSE 250 - Fallers

Endeavour Mining (EDV) 3,650.00p -5.73%

GB Group (GBG) 244.50p -4.86%

Hochschild Mining (HOC) 489.60p -4.65%

Trustpilot Group (TRST) 157.80p -4.20%

Playtech (PTEC) 271.50p -3.88%

Lancashire Holdings Limited (LRE) 617.00p -3.74%

AO World (AO.) 109.20p -3.53%

NCC Group (NCC) 134.40p -3.45%

Big Yellow Group (BYG) 1,012.00p -3.25%

Me Group International (MEGP) 146.60p -3.18%