FTSE 100 soars 21.5% in 2025 as utilities outperform energy stocks

A historic rally in the FTSE 100 reveals a major shift: utilities are the new darlings of the market. Can National Grid and United Utilities sustain their explosive gains?

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2026 May 4 . 8:01 PM

1 min read

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FTSE 100 soars 21.5% in 2025 as utilities outperform energy stocks

Investors are shifting their focus from energy stocks to utilities in search of steady growth and reliable dividends. This change comes as discussions around net-zero targets continue. Meanwhile, the FTSE 100 has recorded its best annual performance in over a decade. The FTSE 100 saw a 21.5% gain in 2025, marking its strongest calendar year since 2009. Financial, defence, energy, and utilities sectors led the growth.

National Grid has been a standout performer, with its share price rising by 20.7% over the past year. The company now trades at a price-to-earnings ratio of 21. Analysts expect its earnings per share (EPS) to climb by 14% in the current financial year. Looking ahead, National Grid forecasts an annual EPS increase of 8% to 10% over the next five years. The firm has also committed to a £70 billion capital investment programme during this period.

United Utilities has seen an even sharper rise, with its stock price up by 30.9% over the last year. The company reported a 42% jump in EPS, reaching 107.1p. Another key player, SSE, is projected to deliver underlying EPS between 147p and 152p. The shift towards utilities reflects investor confidence in their long-term stability and dividend potential. With strong earnings growth and major investment plans, companies like National Grid and United Utilities are positioning themselves as key players in the market. The FTSE 100’s recent performance further highlights the sector’s growing influence.