Home Estate Planning ‘The London stock exchange has a problem – and it’s getting worse’

‘The London stock exchange has a problem – and it’s getting worse’

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The combined market capitalisation of London Stock Exchange-listed firms has shrunk by 17 per cent since 2013, in the latest sign of the exchange’s struggles.

Analysis of data by investment platform XTB also revealed that the number of firms listed on the London Stock Exchange has fallen by more than 25 per cent over the last decade, with the pace accelerating in 2023.

The number of companies listed in London decreased in nine of the last ten years, whilst the total value of companies listed on the LSE only grew – in nominal terms – in three of the last ten years due to the pace of delisting.

Joshua Raymond, director of XTB said the data “identifies a problem – and suggests that it is getting worse.

“These kinds of trends can take a long time to turn around and will need a concerted effort by all parties. However, London retains all the key attributes that companies and investors look for, the institutions, talent pool and rule of law that underpins all successful markets.”

Earlier this month the Corporation of the City of London reported that London had retained its number one slot in the global rankings of financial centre, but acknowledged that the capital’s listing woes imperilled that status.

City grandees and scale-up founders alike have bemoaned both the stock exchange’s liquidity and volumes in recent months, with the IPO window all but shut over the past twelve months.

Just this month alone, two more listed firms have expressed their frustration at what they see as a market which is not rewarding solid performance with share price improvements.

Wincanton chose to sell up to a French operator whilst Benchmark Holdings kicked off a strategic review of its sale options.

A number of reviews published in recent years have called for reforms of the public markets, but many of the recommendations within have yet to be followed through despite pressure from lobby groups including the Quoted Companies Alliance.

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