Over in the US, the benchmark S&P 500 index surged to an all-time high this week, while the Dow Jones Industrial average is following close behind. This year alone the S&P 500 has reached an all-time high eleven times and now the index is now around 30% above its pre-financial crisis high.
However, here in the UK, the FTSE 100 index remains around 100 points below its all-time high of 6930, reached more than two decades ago. Unfortunately, the index is being held back by some of its largest constituents: HSBC (LSE: HSBA), GlaxoSmithKline (LSE: GSK), BP (LSE: BP) and BHP Billiton (LSE: BLT).
Held back 
HSBC, BP, GlaxoSmithKline and BHP are four of the FTSE 100’s largest constituents, making up 6.6%, 5.6%, 4.5% and 2.3% of the index respectively.
In total, these four companies make up around 19% of the FTSE 100 and all four have underperformed the FTSE 100 significantly over the past five years. BP, for example, has underperformed the index by around 50%, while HSBC has underperformed by around 42%.Â
So, HSBC, BP, Glaxo and HSBC are all holding the FTSE 100 back but how much longer will this last?Â
Time to grow?
It would appear as if the FTSE 100’s lacklustre performance is set to continue, as all four companies are lacking direction.
BP is being held back by the stream of liabilities still haunting the company after the Gulf of Mexico disaster. Additionally, the company has come under pressure thanks to its near 20% share in Russian oil giant Rosneft, which has been hit by sanctions. Nevertheless, BP appears cheap at current levels. The company currently trades at a forward P/E of 10.2 and is set to support a dividend yield of 4.8% next year.Â
HSBC is grappling with rising costs as regulators around the world tighten the screws on banks. These costs are putting pressure on the bank’s earnings, which fell 10% during the first half of the year. However, like BP, HSBC currently trades at an attractive valuation. The bank currently supports a dividend yield of 4.6%, set to hit 4.8% next year and the shares trade at a forward P/E of 12.1. 
Unlike BP and HSBC, BHP is shrinking to grow. The company is spinning off some of its unwanted non-core assets, freeing up cash for reinvestment into higher return assets, great news for investors. BHP currently trades at a forward P/E of 12.6 and is set to support a dividend yield of 3.9% next year.Â
And finally, Glaxo. Glaxo’s share price has slumped following its illegal activities within China, activities which have left the company open to investigation around the world. That said, due to the defensive nature of Glaxo’s business the company remains a safe bet. At present the company trades at a forward P/E of 15.4 and will support a dividend yield of 5.7% next year.Â
The recovery continues
There are no if’s or but’s about it, the economy is roaring back to life and so is the stock market. Indeed, the UK investment management industry has reported that equity funds have been the best-selling asset class for the past eleven consecutive months.