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FTSE 100 explained: the UK index that earns abroad

The FTSE 100 is London's top table. Its biggest members sell oil, medicine, metals and everyday goods all over the world, so it often marches to a global beat, not a British one.

Market guide · 6-minute read · Updated 2026-10-21

At a glance

FTSE Russell, part of the London Stock Exchange Group, runs the index. It started in 1984 at a base of 1,000. Members are reviewed every quarter.

What moves it

• The pound. Many big members earn most of their money abroad and report in pounds. When the pound falls, those foreign earnings are worth more in pounds. So the FTSE 100 often rises when the pound weakens. See GBP/USD.
• Oil and metals. Large energy and mining companies carry real weight. Moves in crude oil and metal prices often show up here.
• The Bank of England. It sets UK interest rates. Decisions usually come out at 12:00 noon London time, which is about 7:00 am ET.
• UK data. UK inflation and jobs reports usually land at 7:00 am London time, around 2:00 am ET, before the open.
• Global mood. Banks, drug makers and consumer-goods giants respond to the world economy more than to the UK alone.

When it's busiest

• 3:00 – 4:00 am ET: the London open.
• 8:30 – 9:30 am ET: US data at 8:30 am, then the US stock open at 9:30 am, often stir it again.
• 11:30 am ET: the London close, with a short closing auction just after.

The daylight-saving catch: the UK and US change clocks on different dates in March and in late October / early November. For those weeks, the London hours sit an hour off their usual ET times. Our market hours tool does that math.

Its personality

• Often steadier than tech-heavy indexes. It holds few large tech companies, so it can move differently from the Nasdaq-100.
• Old-economy flavour. Banks, energy, miners, drug makers and consumer staples set the tone.
• Pound in reverse. A falling pound often helps it; a rising pound can hold it back.
• Dividend-heavy. Many members pay large Dividends. On the days shares go ex-dividend, the index can dip slightly for that reason alone.

Reading it with our method

Start on the daily chart. Mark the last places price turned around and decide the direction: higher highs and higher lows, or the reverse.

Then, on your smaller chart, take only trades that agree with it. A level only breaks when a candle body closes past it. The 3:00 am ET open often pokes through levels with tails.

Set your stop from the chart and size from the stop. Futures traders: check the current contract specs on the exchange site first. ETF traders: the position size calculator turns your stop into a share count.

Common mistakes

• Treating it as a UK economy gauge. Many members earn most of their money outside Britain.
• Expecting it to rise with the pound. Often it's the other way around.
• Missing the clock-change weeks. London opens at a different ET time for a few weeks a year.
• Ignoring oil. On a big oil day, the FTSE 100 can move even when stock news is quiet.

Questions