The weakened pound has boosted many of the 100 companies forming the top-flight index.
Why is this happening?
Most are not based in the UK, so a less valuable pound means their sterling-priced shares are cheaper to buy for people using other currencies, typically US dollars.
This makes the shares better value, prompting more to be bought. This greater demand has brought up the prices and the FTSE 100.
The pound has been hovering below $1.22 for much of Friday. It’s steadily fallen from being worth $1.34 in late September.
Also spurring the new record are market expectations for more interest rate cuts in 2025, something which would make borrowing cheaper and likely kickstart spending.
What is the FTSE 100?
The index is made up of many mining and international oil and gas companies, as well as household name UK banks and supermarkets.
Familiar to a UK audience are lenders such as Barclays, Natwest, HSBC and Lloyds and supermarket chains Tesco, Marks & Spencer and Sainsbury’s.
Other well-known names include Rolls-Royce, Unilever, easyJet, BT Group and Next.
If a company’s share price drops significantly it can slip outside of the FTSE 100 and into the larger and more UK-based FTSE 250 index.
The inverse works for the FTSE 250 companies, the 101st to 250th most valuable firms on the London Stock Exchange. If their share price rises significantly they could move into the FTSE 100.
A good close for markets
It’s a good end of the week for markets, entirely reversing the rise in borrowing costs that plagued Chancellor Rachel Reeves for the past ten days.
Fears of long-lasting high borrowing costs drove speculation she would have to cut spending to meet self-imposed fiscal rules to balance the budget and bring down debt by 2030.
Please use Chrome browser for a more accessible video player
3:18
They Treasury tries to calm market nerves late last week
Long-term government borrowing had reached a high not seen since 1998 while the benchmark 10-year cost of government borrowing, as measured by 10-year gilt yields, was at levels last seen around the 2008 financial crisis.
The gilt yield is effectively the interest rate investors demand to lend money to the UK government.
Only the pound has yet to recover the losses incurred during the market turbulence. Without that dropped price, however, the FTSE 100 record may not have happened.
Also acting to reduce sterling value is the chance of more interest rates. Currencies tend to weaken when interest rates are cut.
After a summer dominated by criticism over the small boats crisis and asylum hotels, Labour says it’s planning to overhaul the “broken” asylum system.
As MPs return to Westminster today, Home Secretary Yvette Cooper will speak about the government’s success in tackling people smugglers and plans for border security reform.
Image: August saw the lowest number of Channel crossings since 2019 – but the last year has the most on record. Pic: Reuters
Labour hopes that the raft of changes being proposed will contribute to ending the use of asylum hotels, an issue which has led to widespread protests over the summer.
Ms Cooper will set out planned changes to the refugee family reunion process to give “greater fairness and balance”, and speak to the government’s promise to “smash the gangs” behind English Channel crossings.
National Crime Agency (NCA) figures show record levels of disruption of immigration crime networks in 2024/25. Officials believe this contributed to the lowest number of boats crossing the Channel in August since 2019.
But, despite the 3,567 arrivals in August being the lowest since 2021, when looking across the whole of 2025, the figure of 29,003 is the highest on record for this point in a year.
Labour says actions to strengthen border security, increase returns and overhaul the asylum system, will result in “putting much stronger foundations in place so we can fix the chaos we inherited and end costly asylum hotels”.
In a message to Reform UK, which has promised mass deportations, and the Tories, who want to revive the Rwanda scheme, Ms Cooper will say: “These are complex challenges, and they require sustainable and workable solutions, not fantasy promises which can’t be delivered.”
Please use Chrome browser for a more accessible video player
5:53
The town at boiling point over migration
While the home secretary will look back at the UK’s “proud record of giving sanctuary to those fleeing persecution”, she will argue the system “needs to be properly controlled and managed, so the rules are respected and enforced, and so governments, not criminal gangs, decide who comes to the UK”.
She will also give further details around measures announced over the summer, including the UK’s landmark returns deal with France, and update MPs on reforms to the asylum appeals process.
Shadow home secretary Chris Philp dismissed Ms Cooper’s intervention as a “desperate distraction tactic”, reiterating record levels of illegal Channel crossings, the rise in the use of asylum hotels and the highest number of asylum claims in history in Labour’s first year.
Please use Chrome browser for a more accessible video player
2:52
Richard Tice reveals how navy would deal with small boats
Sir Keir Starmer too, says he intends to “deliver change,” using a column in Monday’s Mirror to criticise the Tories and Reform UK for whipping up migrant hatred.
And the prime minister isn’t the only one to hit out at Reform UK’s flagship immigration plan, with the Archbishop of York accusing it of being an “isolationist, short-term kneejerk” approach, with no “long-term solutions”.
Meanwhile, the Court of Appeal will hand down its full written judgment in the Bell Hotel case today, which saw Epping Forest District Council fail in an attempt to stop asylum seekers from being put up there.
Protests continued in Epping on Sunday night, with police arresting three people.
An anti-asylum demonstration also took place in Canary Wharf on Sunday, which saw a police officer punched in the face and in a separate incident, a child potentially affected by synthetic pepper spray.
A murder investigation has been launched after a man was fatally stabbed in Luton, Bedfordshire, on Sunday.
Police said officers were called to Humberstone Road just after 6pm after reports of an altercation involving two men and a woman.
A man in his 20s was taken to hospital with serious injuries but was pronounced dead shortly after.
Police are appealing for any further information, including doorbell, CCTV, or dashcam footage from the area around the time of the incident.
Superintendent Rachael Glendenning, from Bedfordshire Police, said: “This is an isolated incident, and we would ask the public not to speculate at this time.”
She said officers will be at the scene for a significant period while the investigation continues.
A British woman has been stabbed to death in the Cambodian capital Phnom Penh, police have said.
Local media have named the victim as 34-year-old Jessica Cariad Hopkins.
Deputy commissioner general and commissioner of Phnom Penh Police Chuon Narin said the victim was found dead with stab wounds near a popular park in the capital’s Chamkarmon district on Friday.
A 33-year-old woman, also believed to be a foreign national, was arrested in connection with the stabbing on Saturday afternoon.
Mr Narin said the motive for the killing was believed to be a love triangle.
The Foreign, Commonwealth and Development Office say they are supporting the family of the victim and are in contact with local authorities.