The FTSE 100 continues to roar ahead. In early January, it broke through the 10,000 barrier for the first time. And since the start of 2026, it’s risen by nearly 10%. If this rate of progress continues, it’ll reach 11,000 within a couple of weeks (13 March).
If it does, it’ll be the fastest rise of 1,000 points since the index was launched in January 1984. But what’s driving this performance? And will it last? Let’s see.
Renewed enthusiasm
The index is dominated by stocks that could, perhaps unkindly, be described as old-fashioned.
Banks, providers of industrial goods and services, and miners account for 36% of the value of the FTSE 100. With precious metals prices soaring, and growing concerns about how artificial intelligence (AI) might disrupt specific sectors, these asset-heavy stocks are proving popular with investors once more.
In particular, it appears as though the Footsie’s more traditional stocks are benefiting from current uncertainty about how AI could affect data and software companies.
Ironically, the business that’s responsible for running the index – the London Stock Exchange Group (LSE:LSEG) – is one of those caught in the fallout. Since February 2025, the stock’s tanked 27%.
And on 3 February, it slumped 12.8% after it was announced that AI company Anthropic had launched a series of plugins that can automate mundane tasks. As yet, the American company hasn’t produced anything that’s likely to be a direct threat to the London Stock Exchange Group but the direction of travel appears to be a concern for investors.
That’s because the group also provides data, analytics, and risk management services.
An opportunity or a threat?
However, I see the group’s vast data resource as a strength and something that’s likely to help it see off the threat of these AI tools. Indeed, it’s sometimes hard to get your head around the quantity of information it holds.
The group says its ‘Tick History – PCAP’ repository for “ultra-high-quality” global market data holds 80 petabytes of information, equivalent to 1.6bn filing cabinets filled with documents. Every day, its real-time data service transmits over 230bn messages.
Data like this can be valuable to customers, which is why they pay a premium price for accessing it. There’s also minimal extra cost involved in providing it to another user. In 2025, it reported a gross profit margin of over 90%. It also prides itself on its accuracy. Anyone who’s used AI products will know they’re still prone to errors.
At the moment, I see no immediate threat to the group’s business. In fact, I think the AI-induced share price slump is a buying opportunity. At the moment (1 March), it’s trading on an attractive 20 times its adjusted 2025 earnings. I reckon it’s too early to write off the London Stock Exchange Group. That’s why I think it’s worth considering.
Looking ahead
Of course, it’s impossible to know for sure whether the FTSE 100 will reach 11,000. And if it does, it’s even more difficult to accurately predict what will happen thereafter.
But history suggests the index will continue to climb. Remember, it started at 1,000 and has risen steadily despite several economic downturns, global conflicts, Brexit, and a pandemic. That’s why I believe the stock market is the best way of building long-term wealth.
