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I’ve been watching the FTSE 250 index this morning as it has been struggling to reach its all time high of 12,220. Through the morning it has climbed over 30 points, but the last four or five were the toughest. Then, during the noon hour, just when it appeared that the 2007 record was about to be reached, the index fell by a point, only to begin scratching its way upward again. In the 2 minutes between 12:58 and 13:00 it struggled up 12,219.57, and then on to 12,221.58.
The FTSE 250 stayed above the old 12,200 marked to about six minutes before slipping back into the 12,219 range, where it seems to have stopped to take a breath. At 13:12 it pulled back over 12,220 where it is, at this moment, hanging on for dear life.
So, now we know when the index will cross the line. It already has. Now that an all time high has been reached, the question will become ones of sustainability. Can it stay there? How long can it stay there? Will it go higher? In just the few minutes that it has taken to write this far, it continues to hang out just below the old 12,220 mark.
When watching an index chart, one can be lulled into feeling that some magical force is drawing it. The excitement comes when one realizes that the chart is being drawn as an expression of investor confidence in the participating companies comprising the index. Yes! That is the exciting thing! Investor confidence!
Now, a word to the worry warts. Yes, we know that what goes up must come down. But for you pessimist, that really applies primarily to gravity. This is a sign, not of height, but of building strength. This is a result of businesses prospering because of excellence in strategies, operations, efficiency, and customer satisfaction. It is a microcosmic picture of a sector of the UK economy. Even though the index may dip back to, say, 12,213.17, still the fact remains that it reached 12,221.58, and that 12,212 is still 22 points higher that yesterday’s close.
It’s time to raise a pint and cheer. We have watched history this afternoon. The fun now will be watching it happen again. What do you say we ask ‘world renown Nobel laureate Thomas Sergeant‘ about when that could happen?
ADVFN: “Mr. Sergeant, can you tell us if and when the FTSE 250 will reach 12,221.58 again and if it will keep on moving to greater heights?”
Sergeant: “No.”
There you have it. An honest man with an honest answer. All the better for us to to watch the market closely and with great enthusiasm and anticipation.
