FTSE 100 Hits Record High Amid Market Volatility

The FTSE 100 has reached a new record high, closing at 10,341.56, following a tumultuous day marked by significant fluctuations in commodity prices. This surge comes despite a European-wide sell-off that initially depressed investor sentiment.

Concerns in the commodities market were spurred by a sharp decline in both gold and silver prices, triggered by oil sinking by 4.4% in response to statements made by President Trump. His remarks suggested a de-escalation of tensions with Iran, leading to investor reassessment.

Gold closed down nearly 2%, finishing at $4,648.76 per ounce, its lowest value since mid-January. Analysts note that gold’s recent decline has been steep, down 13.1% from its earlier peak. Silver fared similarly, falling 1.9% to $76.78 an ounce, after reaching a high of $115.08 just a week prior.

Traders have pointed to the dollar’s recovery as a contributing factor to the FTSE’s rise. With approximately 75% of the FTSE 100 companies earning their income in dollars, this uptick tends to bolster their market standing.

Looking ahead, analysts have mixed views on the trajectory of precious metals. Some suggest buying on the dip, indicating potential for a recovery in gold prices. UBS forecasts that gold could reach as high as £6,200 in the near future.

The dollar index also reflected notable gains, rising nearly 0.5% over the course of the day and up by 1.6% over the preceding week. This strengthening may be indicative of broader confidence amongst investors in US economic prospects.