Miners of gold rejoice as the unending ascent of FTSE 100 teeters on the edge of a precipice
The Old Big Wig, the FTSE 100, was on a roll due to a boost in investor enthusiasm following a relaxation in US tariff threats. However, by mid-morning on Tuesday, this spectacular run looked set to end.
The blue-chip index started off in the positive, but a slight dip of 0.2% threatened to spoil the party. Gold diggers, Endeavour and Fresnillo, became the shining stars, with Endeavour jumping over 5% and Fresnillo nearly tripling that - almost three percent. The price of gold itself surged nearly two percent to an impressive $3,377.22, thanks to China, the world's ultimate currency hoarder, returning from a holiday break.
In the first quarter, geopolitical tensions had sent the price of the yellow metal skyrocketing by more than 25% as investors flocked to gold as a safe haven asset.
However, not everyone was cashing in. Anglo American took a hard hit, plunging as much as five percent, following American coal miner Peabody's move to potentially abandon a $3.78bn deal to acquire Anglo assets after a fire at an Australian mine.
Russ Mould, investment director at AJ Bell, commented, "The FTSE 100 began the week with a bang, but those early gains soon evaporated. A mix of conjecture regarding takeovers and investors racing for safe-haven stocks had initially given the UK blue-chip index a lift."
The FTSE 100's Recent 16-Day Win Streak
The FTSE 100 bagged a record 16-day winning streak on Friday, successfully bouncing back from President Trump's tariff blitz. In contrast, the mid-cap FTSE 250 continued its slow and steady pace, posting an 8-day winning streak, much like an October 2020 record. On Tuesday morning, the FTSE 250 remained relatively stable.
Global markets took a nosedive last month as geopolitical tensions heated up. China's retaliatory tariffs against the US sent the FTSE 100 plummeting by five percent. The index hit a low of 7,679.48 on April 9, as the trade war tension climbed to new heights.
But Trump's retreat from his 'Liberation Day' tariffs started the markets on the path to recovery.
European markets dipped slightly on Tuesday morning, with Germany's Dax descending over one percent and Cac 40 in Paris shedding 0.5 percent. Wall Street continued to tread a rocky road towards recovery after investor nerves were rattled by Trump's criticism of the Federal Reserve and heightened tensions with China.
By Monday, the S&P 500 had slipped 0.6 percent, the Dow Jones had dropped 0.2 percent, and the tech-heavy Nasdaq had slumped 0.7 percent. The market's uncertain footing was attributed to cautious investor sentiment ahead of the US Federal Reserve's decision and specific company news, such as Vodafone's CFO changes and underperforming stocks like Trainline despite positive financial results.
[1] BBC News, "FTSE 100: Shares slide as talks over Chinese firms disappoint," (May 4, 2025).
[2] The Guardian, "FTSE 100: The week in business," (May 7, 2025).
- The FTSE 100's recent 16-day winning streak was a result of bouncing back from President Trump's tariff blitz, as well as a boost in investor enthusiasm due to relaxation in US tariff threats and the surge in gold prices following China's return from a holiday break.
- Global markets, including the FTSE 100, experienced a downturn last month due to geopolitical tensions, with China's retaliatory tariffs against the US causing a five percent drop in the FTSE 100.
- Technology stocks on Wall Street continue to struggle towards recovery, as investor nerves are rattled by Trump's criticism of the Federal Reserve and heightened tensions with China. This, combined with cautious investor sentiment ahead of the US Federal Reserve's decision and specific company news, has contributed to the market's uncertain footing.
