Although the FTSE 100 eventually settled 0.3% higher at 9,962p, the early rally to an intraday peak of 10,003.68 marked a significant milestone for UK equities. Chancellor Rachel Reeves hailed the surge on social media as a “vote of confidence in Britain’s economy” and a robust start to the new year.

The breakthrough follows a strong performance in 2025, during which the index secured 41 record closes and an overall rise of over 20%. Dan Coatsworth of AJ Bell suggested it was time to “break out the champagne”, noting that the UK market has successfully defied expectations despite global political and trade uncertainty.

Several key players fuelled the Friday ascent. Rolls-Royce continued its upward trajectory as one of the top gainers, rising 3.5% to 1,191p. Gold miner Fresnillo, the top blue-chip performer of the previous year with a massive 400% rally, added another 2.9%. Defence stocks also contributed heavily to the gains, with Babcock and BAE Systems climbing 2.7% and 2.6% respectively.

However, not every sector participated in the jubilation. British American Tobacco dipped over 2%, while Smith & Nephew and British Land saw marginal declines linked to soft house price data. Notably, despite the general market buoyancy, the London Stock Exchange Group itself has struggled, tumbling 22% over the last 12 months. WPP fared even worse, falling nearly 60% in 2025 and suffering a demotion from the index.

Looking ahead, Rebecca Maclean, investment director at Aberdeen Investments, and co-manager of Dunedin Income Growth investment trust, noted that the UK remains one of the cheapest equity markets globally, “creating fertile ground for future returns”. She highlighted that while large caps have led the charge, “UK mid‑caps lagged last year’s rally and could present a compelling place for investors to focus next”.