LONDON — The U.K. is facing the weakest growth prospects in the G-7 and a catalogue of cost-of-living pressures that are pushing the poorest into crisis and intensely squeezing the budgets of middle-income households.

At the same time, more investor money has never been pumped into the U.K.’s biggest companies. The FTSE 100 index has smashed through three intraday records over the last week, starting last Friday and hitting new heights in Wednesday’s and Thursday’s sessions.

That’s also coming off the back of a year in markets that was dominated by doom and gloom, with risk assets selling off and indexes from the pan-European Stoxx 600 to the U.S. S&P 500 to Shanghai’s SSE Composite emerging bruised.

The most recent uptick for the FTSE 100 shows that, as well as occurring despite harsh cost-of-living pressures, they are also linked to them.

Energy firms such as Shell and BP have reported record profits and promised higher shareholder dividends, boosting their share prices (with calls for higher windfall taxes to support consumers struggling with higher bills doing little to dampen their appeal).

Thursday’s FTSE climb to an all-time high of 7,944 points at midday in London was boosted by gains at Standard Chartered, one of many banks that have seen profits jump as a result of higher interest rates.

Meanwhile, the strong performance of commodity stocks has also lifted the index higher as they have been boosted by a rise in prices, supply constraints and, recently, the prospect of China’s Covid-19 reopening.

“The U.K. FTSE 100 is not about the U.K. domestic economy,” said Janet Mui, head of market analysis at RBC Brewin Dolphin, noting over 80% of firms’ corporate revenue exposure is derived from overseas.

Mui told CNBC a confluence of factors had taken the index to a record high, including the plunge in sterling helping those overseas revenues (collected in dollars); its heavy weighting in energy, commodities and financials; and the relatively strong performance too of defensive staples in consumer products — such as Unilever — and health care — such as AstraZeneca.

What the U.K. stock market has frequently been criticized for — a lack of new, buzzy tech firms and preponderance of stalwarts of the “old economy” — has been a boon as monetary and financial cycles have turned.

The wider FTSE 250 does have stronger domestic links but still has 50% of revenue exposed to overseas, Mui added.

Susannah Streeter, senior investment and markets analyst at Hargreaves Lansdown, said that among other factors, the FTSE’s rise could be explained by glimmers of hope in the economic picture, such as housebuilder Barratt reporting a “modest uplift” in reservations of new homes. She also pointed to forward-looking signals of Europe avoiding a recession and an abating of the energy crisis.

Banks would perform even better if their net income margins improve but bad loans don’t come through, she noted.

Among the factors weighing on the U.K. public are interest rate rises increasing borrowing costs, grocery price inflation at a record high of 16.7% and overall inflation above 10%.

A report 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 ($4,873) 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 recently arguing that maintaining support packages risks maintaining inflation.

But 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.