Whither the FTSE 100?
As 2014 gets underway the Christmas and New Year break, which one sensed at the time was going on and on and on, is now becoming a distant memory! The year is gathering momentum and the green shoots of recovery, which increasing numbers of commentators were seeing as 2013 drew to a close, really do seem to have come with us into the new year and are growing. Furthermore, they are encouraging continuing, albeit cautious, optimism about the months ahead.
It has been interesting too to see the new year predictions being made about what 2014 holds in store for the British economy and the financial markets.
The FTSE 100 ended 2013 at 6,749, not far short of its all-time high of 6,930, which it reached on 30 December 1999, at the height of the dot-com boom. In March 2009 it sank to 3,529, it’s lowest ebb since the index was established in 1984 (at 1,000).
Citigroup analysts have suggested it will reach 7,500 by mid-2014 and will go on to break through the 8,000 barrier by year-end. Wow!
A poll of fund managers carried out by the Association of Investment Companies found that 58% of those polled believed the index would finish above 7,000 at the end of 2014.
A more cautious group of commentators – my investment club – have registered their year-end projections for the FTSE 100, ranging from 5,970 to 7,350, with my own prediction sitting at 7,117!
The FTSE 100 is only one barometer of the state of the nation’s financial health, but it does tend to provide a reasonable reflection of the underlying financial conditions.
Where do you think the FTSE 100 will get to by the end of 2014?