The number of companies listed on the London stock market dropped by a record amount last year in the latest blow to the City.
At the end of 2023 there were 1,836 firms quoted on the London Stock Exchange (LSE) with a combined value of £3.5trillion, according to data from fintech firm XTB.
This was down on the previous year, when the exchange had 1,954 listed firms worth £3.7trillion.
Despite rebounding in some years, the LSE has seen an overall decline in the number of listed companies and its total value over the past decade.
The peak for listings came in 2013 when 2,448 firms made up the exchange with a combined value of £4.3trillion. But the highest market cap was in 2016 when the LSE had 2,267 listed businesses worth nearly £4.6trillion.
Record low: The number of companies listed on the London stock market dropped to 1,836 at the end of 2023
The revelation comes amid growing concern that London is losing its status as a global financial hub.
Companies and investors alike are being lured to other markets, particularly the US, by hopes of higher valuations and growth prospects.
The LSE’s chief executive Julia Hoggett has even suggested UK bosses should be allowed to be paid more to stop them going to America, where salaries and bonuses are often much higher.
The debate has intensified following a series of high-profile snubs for London last year.
Cambridge-based computer chip maker Arm chose the New York market for its blockbuster debut despite intense lobbying from UK officials.
Firms such as gambling giant Flutter, packaging group Smurfit Kappa and construction supplier CRH have also drawn up plans for secondary listings in the US or to quit the London market entirely.
‘This data identifies a problem, and suggests that it is getting worse,’ said Joshua Raymond, director of XTB.
‘To maintain London’s position as a global financial hub we need a vibrant and successful stock market with a deep liquidity pool and a broad range of companies for investors to choose from.’
Last month, former Chancellor George Osborne said the moves had caused ‘quite a lot of paranoia’ in financial circles that London was losing its lustre as a stock market hub. He said shareholder attitudes were largely to blame, which made it difficult for London to keep hold of innovative companies or attract big tech firms.
The Government and stock market officials have been scrambling to implement plans to make London more attractive to firms and investors as well as changing rules around pension fund investments in UK companies.
