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London stock market floats plunge to six-year low

A worker shelters from the rain under a Union Flag umbrella as he passes the London Stock Exchange in London
Travel giant TUI is the latest company considering listing elsewhere - Toby Melville/Reuters

Applications to list on the London Stock Exchange (LSE) have plunged this year despite efforts to revive the City.

The number of requests to float on the main market of the LSE has slumped to its lowest level in at least six years, according to data from the Financial Conduct Authority (FCA).

The figures come as the City struggles to recruit and retain high-profile companies, leaving executives and policymakers grappling with how to arrest the Square Mile’s decline.

In the latest blow to Britain’s financial hub, travel giant TUI said last week it is considering plans to ditch its listing on the London Stock Exchange.

Only 56 companies applied to list their shares on the LSE’s main market between January and November 23 this year, according to figures released by the FCA in a freedom of information request from investment platform XTB.

Applications have been declining since 2021 when 125 companies put in submissions.

This year’s figures remain well below the average of 112 companies a year between 2018 and 2022.

Joshua Raymond, director of XTB, said: “The decline in activity on the IPO market is particularly concerning for private investors.

“The listed stock market is the easiest and most widely understood way for retail customers to invest their money. We need a steady flow of new companies coming to the market.”

Among the companies to have ditched London in favour of New York listings in the past year include chipmaker Arm and building materials giant CRH.

Businesses have been attracted to the US by the higher values investors tend to put on new listings, increased liquidity offered by the market, and higher pay and bonuses for executives.

Last month FTSE 100 chiefs urged the Chancellor to end the “vicious cycle” of Britain’s stock market decline, calling for sweeping reforms to revive investment in the City.

The figures come as the City of London Corporation prepares to open its first-ever offices in New York as it aims to foster closer ties between the world’s two largest financial hubs.

The governing body for London’s financial district will also set up shop in Washington as part of a charm offensive to drum up support for the Square Mile.

Its presence in New York and Washington will allow the Corporation to meet US Congress officials, regulators and policymakers.

The corporation’s main objective will be to make it easier for US investors to open offices in the UK or invest more.

It will also seek closer cooperation on cybersecurity, digital regulation, and AI and more technical discussions with US authorities on cryptocurrency.

The Corporation was founded in 1067 and is one of the oldest institutions in the world. It exists as a governing body for the Square Mile and represents its interests to the Government and around the world.