The FTSE 100 index climbed above the 9,300 mark on Monday, rising by 46 points to reach 9,331, its highest level in nearly six weeks. The increase was primarily driven by a surge in shares of GSK, following the announcement of a leadership transition, alongside strong performances from mining, defence, and financial sectors.
GSK’s Leadership Change Sparks Investor Optimism
GSK emerged as the standout performer on the index, with its shares advancing by 3.5% to £1,538. This rally followed the announcement that Luke Miels will take over as chief executive from Emma Walmsley at the beginning of next year. While Walmsley’s leadership was noted for maintaining financial discipline, concerns have lingered over GSK’s muted growth. Derren Nathan, head of equity research at Hargreaves Lansdown, pointed out that although GSK has consistently met its guidance, long-term revenue growth remains a challenge. Investor sentiment appears to be favourable towards Miels, with hopes that he can guide the company towards its ambitious target of $40 billion in sales by 2031.
Broader gains contributed to the FTSE 100’s upward momentum, with shares of AstraZeneca also seeing a rise of 1% to £11,140. The pharmaceutical giant announced plans to directly list its ordinary shares on the New York Stock Exchange, while maintaining its existing London listing and UK headquarters. This strategic move is intended to expand its investor base as the company increases its footprint in the US market, which includes a significant $50 billion investment programme focused on manufacturing and research and development.
Market Drivers and Global Economic Context
Additional support for the FTSE 100 came from industrial heavyweight Rolls-Royce, which gained £5.5 to reach £1,188, drawing closer to a £100 billion valuation. Other notable performers included Antofagasta, which rose £63 (2.36%) to £2,729, Prudential adding £23.5 (2.27%) to £1,058.5, and Convatec, which increased £5.2 (2.31%) to £230.4. Shares of JD Sports Fashion climbed 2.7% to £91.4, while Metlen Energy & Metals also saw a gain of 2.45% to £48.05.
Investor sentiment globally was bolstered by gold trading above $3,800 per ounce for the first time, reflecting safe-haven demand amid expectations of potential interest rate cuts by the US Federal Reserve later in the year. On Wall Street, positive sentiment surrounding inflation data resulted in the Dow Jones rising by 0.7%, the S&P 500 increasing by 0.6%, and the Nasdaq Composite gaining 0.4%. In Asia, the Nikkei 225 fell by 0.9%, contrasting with a 2% rise in Hong Kong’s Hang Seng index, highlighting mixed regional market reactions.
Concerns regarding a potential US government shutdown eased slightly following reports that President Trump would convene with both Democratic and Republican leaders in an effort to prevent a funding deadlock.
As the FTSE 100 approaches its all-time high, the momentum is largely driven by pharmaceutical stocks and a resurgence in global risk appetite. Despite the current rally, investors remain cautious due to ongoing geopolitical risks and uncertainties surrounding US fiscal policies.
