As Brits reel from a cost-of-living crisis, the UK stock market quietly booms to an all-time high

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The FTSE 100 has hit three all-time highs over the last week, despite continued gloom on the U.K. economy and amid a cost-of-living crisis.

published Wednesday by the National Institute of Economic and Social Research argued the U.K. was likely to avoid a technical recession this year — though growth would be near zero — but that one in four households will be unable to fully pay their energy and food bills, and middle-income households will face up to a £4,000 drop in disposable income.

And the disjunct between stock market gains and the dire outlook still facing many households jars for many. "It is a cruel paradox that on the day that the FTSE 100 index hit a record high, campaigners on behalf of up to 7 million people on lower incomes in the UK were calling for the government to extend the support provided to them with regard to their energy bills," Richard Murphy, professor of accounting practice at Sheffield University Management School, told CNBC.

In March, the U.K. government is set to end a broad household energy bill compensation program that has run through the winter. It comes as many governments attempt to wind down fiscal support to rein in public spending, with the European Central Bank recentlyBut Murphy said that without the support, and with bills still elevated, "many will not be able to make ends meet and will go hungry, cold or even homeless as a result.

"The picture that this provides of a country enormously divided by differing incomes and wealth is almost Victorian in its starkness," said Murphy.

 

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