The U.K.’s FTSE 100 has been struggling for years, underperforming compared to other major indexes like the S&P 500 or the DAX. Companies are delisting and big companies are considering moving away from London due to lower valuations. However, there are signs that the FTSE 100 is waking up and there are reasons to believe that it could see a significant rise in the near future.
The market is currently extremely cheap, despite potential for growth, and has been trading sideways for a long time. The CEO of the exchange is not even on the board of the London Stock Exchange Group, further highlighting the market’s struggles. However, recent market weakness caused by geopolitical news has led to a bounce back in the market, with all-time highs being reached.
The chart shows a pressure building for a repricing of the FTSE 100, and it appears to be on a fast hockey stick structure rather than a slower trend. This bullish development indicates a potential bull market for two to three years, or even longer. Those invested in the market are advised to sit back and ride the trend, rather than trying to time the market for short-term gains.
Despite the break out in the FTSE 100 chart, it is not yet completely safe. The market still needs a few more positive days in open ground to solidify the new reality. Valuations are incredibly low, indicating there is plenty of room for growth. With inflation pumping nominal value into the market, it may not deliver as much new buying power as desired, but being in a rising market is better than having cash eroded.
The speaker predicts a target of 10,000 on the FTSE 100 in the near future, but acknowledges that there are many factors that could push levels even higher. The era of stagnation for the FTSE 100 may be over, and investors are advised to stay invested, buy cheap stocks, sell expensive ones, and enjoy the long profitable ride ahead. It is important to take advantage of the potential growth in the market and make sound investment decisions during this promising period.
