It's the season for 2014 predictions – and one of the most popular calls among analysts is a record-breaking performance by the FTSE 100, the U.K.'s main stock market index, next year.
Many are predicting the index will beat its previous high of 6,950, set back in 1999. While it has never scaled 7,000 before, strategists at Citi forecast it will reach 8,000 next year.
This optimism is not just because the U.K. economy is showing signs of improvement -- the Office for Budget Responsibility upgraded its forecast for gross domestic product growth in 2013 from 0.6 percent to 1.4 percent -- there is an international aspect to the optimism. After all, 80 percent of earnings by FTSE 100 companies come from overseas, according to Credit Suisse. And 53 percent of the FTSE 100 is held by investors from outside the U.K.
Following a nervous start to the year, the FTSE 100's overall performance for 2013 has been strong, with a peak of 6,875.62 in May amid central bank stimulus. The index has faltered in December, and is on track for its first declining December since 2002 if it ends the month below 6,650, according to City Index.