In recent months, Arm’s surging share price, propelling its valuation to $130 billion, has led to substantial gains for SoftBank, marking a four-fold profit on their $32 billion investment in 2016.<\/p>\n

The London stock market faces challenges with a diminishing number of listings attributed to a lack of investor interest in UK stocks, particularly in high-growth tech companies. Managers at Baillie Gifford’s UK Growth Trust criticize fellow investors for a “gloomy” outlook, emphasizing a short-term focus over future prospects.<\/p>\n

The decline in UK stocks’ share in pension funds, dropping from half at the turn of the century to less than 10%, adds to the market’s woes. Peel Hunt analysts warn of a ‘doom loop,’ citing low valuations, decreasing liquidity, and a shrinking pool of UK-listed companies. This predicament is further intensified by foreign acquisitions, private equity transactions, and a dearth of new companies entering the public market.<\/p>\n

The decline of UK-listed companies by 40% since 2008 contrasts sharply with Nasdaq’s impressive $13 billion in new share issues for 2023, while the London Stock Exchange (LSE) struggled to raise a mere $972 million, failing to breach the $1 billion mark for the first time since records began in 1995, as per Dialogic data.<\/p>\n

Blaming the investment community, the issue extends beyond regulatory barriers, requiring a fundamental shift in the demand side. If fund managers shy away from backing risk, London’s appeal for listings diminishes. The U.S. offers a stark contrast, encouraging ambitious ventures with robust financial support and a wealth generation appetite absent in the UK, where cynicism often prevails.<\/p>\n

This trend spells potential doom for the London stock market, with economic gravity pulling companies toward New York. Historical examples, like the now-defunct Leeds stock exchange, serve as cautionary tales.<\/p>\n

Addressing this challenge goes beyond mere government intervention; it calls for a comprehensive cultural shift. If the prevailing investor apathy in London persists, there is a looming risk that companies, following in the footsteps of Arm, will keep departing, potentially leaving the London stock market with only a handful of remaining entities. This underscores the urgency of fostering a more dynamic and supportive investment environment to retain and attract businesses on the London stock market.<\/p>\n<\/div>\n<\/div>\n<\/form>\n<\/div>\n","protected":false},"excerpt":{"rendered":"