Markets

FTSE 100 hits record high as fears of Trump trade war wane

The FTSE 100 has hit record highs this morning, blowing past 7,800 to trade at 7,849, levels not seen since before the financial crisis.

The markets rally comes after news over the weekend that the US and China had reached an agreement in order to avoid an all-out trade war.

The trade agreement has also been good news for the dollar, with the greenback reaching $1.34 against the pound.

The market was also boosted by Brent crude oil prices, which hit $80 a barrel for the first time in over three years last week.

Read more: FTSE slips back from all-time highs in the absence of 'magic momentum'

However, Joshua Mahony, market analyst at online trading firm IG, cautioned that the lack of specificity in the US-China deal may mean further market volatility.

“While this is no doubt a good news story for markets, the question over whether there is a specific amount of trade required to fulfil the deal remains relevant,” said Mahony.

“From a headline point of view this looks like a big win for Trump, yet only time will tell whether this whole debacle makes any tangible difference to their trade relationship.”

Read more: FTSE 100 hits record high

The surge in UK markets comes after the FTSE ended last week slightly lower, despite hitting all-time highs on Thursday.

The FTSE 100 edged down 0.12 per cent on Friday to 7,779. Today, the London index edged up almost a full percentage point.

Over the weekend, China agreed to increase its imports of American goods in order to rectify the large trade imbalance between the two countries. As a result, both sides have said they will end tariff threats which have shaken the market in recent months.

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