The FTSE 100 index closed in positive territory on Tuesday, 23 December 2025, as investors welcomed a surprise acceleration in US economic growth and an encouraging uptick in UK business sentiment ahead of the Christmas break.
Market Performance and Key Drivers
The FTSE 100 advanced by 23.25 points, or 0.2%, to finish at 9,889.22. The FTSE 250 saw a more modest gain, adding 6.83 points to close at 22,349.55. In contrast, the AIM All-Share index dipped slightly, closing down 1.67 points at 758.81.
The upbeat mood was supported by two major factors. Firstly, the latest Lloyds Business Barometer revealed that UK business confidence climbed to 47% in December. This marks a five-point increase from November and stands ten points higher than at the start of 2025. Optimism about the wider economy also hit a four-month high, jumping 11 points to 42%.
Hann-Ju Ho, Senior Economist at Lloyds Commercial Banking, commented: “It is great to see business confidence ending the year on a higher note.” The construction sector led the improvement, with confidence soaring 22 points to 61%, its highest level this year.
US Economic Data Surprises to the Upside
The second, and perhaps more significant, boost came from across the Atlantic. Official figures showed the US economy grew at an annualised rate of 4.3% in the third quarter, significantly outperforming the consensus forecast of 3.3%. This represented an acceleration from the 3.8% expansion recorded in the previous quarter.
Analysts at ING described the GDP figure as “eye-popping,” attributing the strength to a robust net trade performance and solid consumer spending. However, they cautioned that growth is likely to slow considerably in the fourth quarter, partly due to the effects of a recent government shutdown.
At the London market close, stocks in New York were also higher. The Dow Jones Industrial Average was up 0.2%, while the S&P 500 and Nasdaq Composite both gained 0.3%.
Notable Stock Movers and Currency Markets
On the corporate front, Metlen Energy & Metals was the top FTSE 100 performer, surging 6.8% after announcing the completion of a major asset sale in Chile at enhanced terms. The final sale price was $865 million, up from an initially agreed $815 million.
In European markets, Denmark's Novo Nordisk jumped 9.2% after receiving US regulatory approval for its once-daily Wegovy weight-loss pill. CEO Mike Doustdar said the pill offers a “new, convenient treatment option.”
Conversely, shares in Videndum plummeted 56% after the broadcasting equipment firm warned that a planned refinancing could severely dilute existing shareholders.
In currency markets, the pound strengthened to $1.3481 at the London close, up from $1.3452 on Monday. The euro also firmed against the dollar, trading at $1.1777.
Looking ahead, Wednesday's economic calendar features US weekly jobless claims data, with no major UK corporate announcements scheduled.
