Finance
FTSE 100 hits fresh 1-1/2 year high in upbeat start to the year
Published by maria gbaf
Posted on January 5, 2022
2 min readLast updated: January 28, 2026
Global Banking & Finance Review®
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Published by maria gbaf
Posted on January 5, 2022
2 min readLast updated: January 28, 2026
FTSE 100 hits a 1.5-year high as Omicron fears ease, boosting UK stocks. Banking and airline sectors lead gains amid economic optimism.
By Bansari Mayur Kamdar
(Reuters) -Britain’s FTSE 100 rose on Tuesday in the first trading session of 2022, after its best annual gain in five years, following signs the Omicron coronavirus variant is less likely to derail the global economic recovery.
The blue-chip FTSE 100 gained 1.6%, closing at its highest since February 2020, while the domestically focussed mid-cap index advanced 1.8% in a catch-up rally after a long holiday weekend.
Financials led gains, with banking and life insurance stocks adding 4.8% and 3.2% respectively.
“A higher rate cycle always calls for a better performance for the banks as it’s going to be helpful in their profits, especially their interest rate margins,” said Ipek Ozkardeskaya, senior analyst at Swissquote.
The yield on two-year British government bonds hit its highest since late October after Prime Minister Boris Johnson said new measures were not needed now to fight the Omicron variant.
London-listed airline stocks soared, with Wizz Air, EasyJet and British Airways-owner IAG gaining between 7.5% and 10%, after Hungary-based Wizz Air reported strong load factor data.
Prime Minister Boris Johnson was due to hold a COVID-19 news conference later in the day, amid a surge of the Omicron variant that has led to record high coronavirus cases and hit staffing numbers at hospitals.
The FTSE 100 gained 14.3% in 2021, its best annual performance since 2016, helped by gains in commodity-linked and industrial stocks.
British retailers gained 1.0%, tracking global sentiment, even though footfall in shops in the days after Christmas was 24.5% lower than the same week in 2019, Springboard analysts said.
British manufacturing grew slightly more quickly than originally thought in December and pandemic-related supply chain problems eased a bit, taking some of the heat out of rising input prices, a survey showed on Tuesday.
(Reporting by Bansari Mayur Kamdar and Amal S in Bengaluru; Editing by Shounak Dasgupta and Alex Richardson)
The main topic is the FTSE 100 reaching a new high amid easing Omicron variant fears and economic optimism.
Banking stocks led gains with a 4.8% increase, benefiting from a higher rate cycle.
Airline stocks soared, with companies like Wizz Air and EasyJet seeing significant gains due to strong load factor data.
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