THE FTSE 100 has edged higher this morning after Oxford University’s coronavirus vaccine was approved by regulators.
Shares jumped to 6,615, up 0.20%, after it was confirmed the jab will be rolled out to millions of Brits from Monday.
⚠️ Read our coronavirus live blog for the latest news & updates
Markets reacted to the glimmer of hope as Health Secretary Matt Hancock said the vaccine will help Britain out of the pandemic by spring.
It comes after the FTSE closed at 6,603 yesterday, December 29, as it marked its highest finish since before lockdown in March.
Yesterday was the first full trading day for markets since the Brexit agreement was reached on Christmas Eve between the UK and the EU.
The footsie index tracks the performance of the UK’s 100 biggest companies.
How the FTSE 100 falling affects your personal finances
FALLS in the stock market can affect your finances in a number of ways, here we explain how.
Pensions – If you save cash into a pension scheme where the provider invests your money, you’ll likely see the value of your pension drop when the FTSE 100 falls.
But keep in mind that with retirement savings, you’re investing for the long-term so the drop in value isn’t likely to be permanent.
Instead, you’ll see your retirement savings grow again once the stock market recovers.
Savings and mortgages – There is no direct link between the stock market and your mortgage or savings accounts.
But if panic on the stock market spreads to the wider economy, the Bank of England may cut interest rates. Interest rates are currently held at 0.1%.
This means your mortgage is likely to get cheaper, while savers will suffer from lower interest rates.
We’ve explained how the interest rate cut will affect your finances here.
Sterling – The value of the pound often rises if the FTSE 100 falls.
This is because many of the firms on the index earns a significant amount of cash in the US.
But again, exchange rates are also volatile and there are many factors that make them rise and fall.
Shares in AstraZeneca and the FTSE 250, which tracks medium-sized British companies, have also risen today.
AstraZeneca shares were up by 1.3% to reach 7,582, while the FTSE 250 was at 20,913, up 0.08%.
In mid-November, the FTSE 100 climbed to its highest point in five months after a second Covid vaccine was found to be 94.5% effective.
It comes as Chancellor Rishi Sunak said he believes 2021 will be a “new era” for Britain.