The FTSE 100 hits a fresh record after the Fed raises rates and Dutch voters reject populism

LONDON — Britain’s benchmark share index, the FTSE 100, has hit a record high on Thursday morning, pushed higher mining firms listed in the UK.

Miners have gained thanks to a rally in commodity prices driven partially by the US Federal Reserve sounding a more cautious than expected tone on further interest rate increases in 2017. 

The Fed raised the benchmark federal funds rate 25 basis points, to a range of 0.75% to 1%, and said it continues to expect two further hikes in 2017. Some had expected the central bank to signal three more hikes. 

The FTSE’s rally comes “thanks to investors ignoring the Fed’s rate hike to concentrate on an unchanged outlook. Forecasting just two more hikes this year, markets have digested the policy update as less hawkish than it could have been. A USD sell-off has thus helped Oil and metals extend rebounds,” Mike van Dulken, head of research at Accendo Markets writes in a morning email.

As a result of this, the FTSE 100 is trading around 0.65% higher as of 8.30 a.m. GMT (4.30 a.m. ET) hitting 7,417 points. A few minutes earlier it reached a high of 7,423, marking the highest intraday level for the index in its history. 

Here is the chart:

The bourse’s top five stocks on the day so far are all mining and commodity focused firms, with platinum and diamond-focused miner Anglo American at the top of the pile, up by 8.37%. Gold and silver firm Fresnillo is close behind with a gain of 6.4%, while Antofagasta, BHP Billiton and Glencore have all gained between 4.4% and 5.6%.

Elsewhere in Europe, stocks are also on a charge, taking heart not just from the Fed’s less hawkish tone, but also from a broad rejection of populism by voters in the Netherlands.

The party of far-right leader Geert Wilders had been forecast by some to win the most seats of any party during the elections, but the PVV looks set to come second once all results are counted, gaining just 20 seats. By contrast, incumbent Prime Minister Mark Rutte’s VVD is projected to win 33 seats with 95% of votes counted, nine fewer than in the 2012 election.

That has cheered investors, and stocks are green across the board. Amsterdam’s AEX index has hit its highest level since before the financial crisis on Thursday morning, while Italy’s FTSE MIB has rallied to its best level since early 2016.

Here is the scorecard:

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