London is no longer the most-valued European stock market
According to research, as the economic slump has had an impact on UK companies, Britain’s stock market has lost its position as Europe’s most valuable market. France has surpassed all other countries because currency fluctuations and consumer demand for French luxury products have increased the value of the total shares of its enterprises.
Since records began in 2003, Paris has never surpassed London, according to Bloomberg data. As inflation increases, it is anticipated that the UK will enter a recession this year.
According to Bloomberg, the overall value of British shares is currently around $2.821 trillion (£2.3 trillion), while the value of French shares is roughly $2.823 trillion.
As consumers limit their spending and corporations struggle with rising costs, shares of medium-sized companies in the UK have been performing particularly poorly. The FTSE 250 share index, which tracks medium-sized businesses in London, has declined by over 17% over the past 12 months.
In the wake of Liz Truss’ mini-budget, the value of the pound has also decreased, raising the cost of imports for businesses. In contrast, according to Bloomberg, currency fluctuations have benefited French businesses. The value of France’s stock market as a whole has also increased thanks to the country’s producers of luxury products.
Due to a rebound in Chinese demand, shares of LVMH, the company that owns the fashion label Louis Vuitton, have increased 22% during the past six months. Before the pandemic, 35% of the world’s demand for upscale items came from Chinese consumers, according to data from Bloomberg. Similar to other nations, the crisis in Ukraine has contributed to rising energy and food prices this year in the UK.
After Liz Truss’s mini-Budget raised UK borrowing costs, many British homeowners have also noticed a significant increase in their mortgage costs. It has made the economy’s pre-existing issues, such as the pound’s ongoing weakness and the decline in trade since Brexit, worse.
The UK is the only G7 country whose economy hasn’t recovered from the pandemic. The UK economy contracted by 0.2% in the most recent quarter, which ran from July to September, and the Bank of England has issued a warning that the nation is now experiencing its longest recession on record. Amsterdam replaced London as the biggest financial trading hub in Europe last year, despite the fact that the measure used was the total value of traded shares rather than companies.
