Having come back from the New Year break, it seemed that nothing could slow down the speed of the UK 100 santa rally, carrying on where it left off before Christmas. Refreshed and ready to go, traders helped the index storm not just one, but two fresh all-time highs during the course of shortened trading week. But is there room for the index to rally further?

As mentioned by my colleague in his article, sector read across during the first week of updated trading statements in 2017 has already proved significant. However, in stark contrast to the UK retail sector’s hazardous performance in the first week of 2017, the first 2017 update from the Housebuilders instead saw the sector shake off a topsy-turvy 2016 and begin the new year on the front foot.

Thursday’s full year trading update from Persimmon was headlined by increasing revenues and sales, despite many predictions that the sector would suffer in the wake of the UK’s vote to leave the EU in June. The promising results despite a surprising 2016 saw the company lead all UK Index risers, closing +7.2% for the day.

In fact, Persimmon’s trading update on Thursday was perceived as so positive that it helped other members of the sector to rally towards the top of the index during the day. Peers Barratt Developments and Taylor Wimpey both finished the day’s trading amongst the top 10 performers of the day, up 2.8% and 5% respectively. Furthermore, both companies report next week.

Could we see yet more positive updates in the wake of the Brexit vote, suggesting a rosy outlook for the sector alongside positive construction data released this week? Or could the opposite happen, where other companies in the sector have not fared as well as Persimmon, in turn hampering the UK Index ‘s charge?

Either way, the significant potential for a read across the sector as a whole is set to have a profound effect on the UK’s blue chip index next week, something many will certainly be keeping their eyes on.

However, it’s also worth noting that the Housebuilding sector is not the only sector that seems to be faring well after Brexit. As a result, some analysts are taking a positive view on UK equities as a whole.

Just this week, Citigroup have upgraded their view of British companies, with the US bank referring the ability to perform positively during periods of of Sterling weakness, a strong outlook for long term returns (with a particular focus on the strong performance of dividend yields) and the potential for early elections to see a greater number of pro-Brexit MPs in government, easing the UK’s transition.

The update concludes with a prediction for the UK 100 to finish 2017 at 7600 points, a further 400 points into record territory. Not bad.

Have you been unable to benefit from the UK Index ‘s New Year rally trying to sift through time-consuming forecasts? Perhaps you missed Persimmon’s update? Let our research department trawl through the data so you can focus on the important trading decisions that need to be made. By signing up to our research here, cut straight through to the important details and make the next 12 months your most efficient trading year ever.

Amrit Panesar, Senior Trader, 6 January