SPECIAL REPORT: Can The FTSE 100 Outpace Its Peers?

*FTSE 100 has lost more than 2% of its value while the Dax is nearly 3%
*FTSE 100 and Sterling's correlation has weakened 
*Ingredients of the FTSE 100 index matter

Can The FTSE 100 Outpace Its Peers?
The FTSE 100 lost minus 0.03% of its value yesterday and it is down nearly minus 7.13% from its recent high of 7,727-- formed back in July 2019. However, the index is up 7.19% year to date.  Its performance against its European peers is of interest. What is interesting to look at is if the index has any potential to outpace the performance of European indices?  
Just to put things in perspective the Stoxx 600 is up 16.69%, the CAC 40 20.53% and the DAX has scored 19.61% gain year-to-date.
If we measure the performance of these major indices since the start of this month, the chart below shows that the Footsie 100 is clearly the lagging index. Thus, despite all the recent Brexit deal optimism—a deal is within reach when it comes to Brexit—the index hasn’t performed well.  

Source: BBG & ThinkMarkets 
The Correlation Is About To Change
One can largely blame the underperformance of the index because of the meteoric rise in the Sterling. The currency is up nearly 3.73% during this month against the dollar. Although, there is still a negative correlation between the Footsie 100 and Sterling, but it is safe to say that's this correlation has lost its strength. Since September this year, we have seen the negative correlation losing its momentum, and it is on the verge of changing its direction—meaning the Footsie and Sterling are likely to move in the same direction.      

Source: BBG & ThinkMarkets 

Is there a problem with Ingredients?
The weakness in the Footsie 100 index has also a lot to do with the feeble global economic growth. Remember, the anemic global growth has a major influence on the commodity demand equation. And when it comes to the FTSE 100 index, its composition is mainly dominated by the miner companies—they almost make a quarter of the FTSE 100 index. So, resolving the Brexit issue only may not be enough for the index to outpace it's European benchmark indices.
To conclude, if the UK leaves the EU with a deal, a more likely scenario now, it would mean that the Bank of England is going to sit on its hands with respect to the extra stimulus. Thus, not much help for the index. But the index would be in a better position as compared to know because the biggest uncertainty would no longer be on traders’ dashboards. Having said this, it could change with because the biggest sector of the FTSE 100 index., the financial sector may be able to provide all the necessary tailwind as the domestic prospect would flourish and a major uncertainty would vanish.