United Kingdom, about to lose the scepter of the largest European stock market

To the missteps of the recently landed British Government with the announcement of its tax reduction package, by not specifying how it will be financed, and its reception by the market with a sharp collapse of the pound and a punishment of the sovereign debt, another ingredient can be added to garnish an explosive cocktail and trigger uncertainty. The British stock market is about to lose the center of the largest European stock market by market capitalization against the French.

The market value of all shares on the British floor has fallen below 2.5 trillion dollars for the first time since 2020 and accumulates a 31.6% cut since the beginning of the year. A decline that the French market has managed to weather better: it cut 32.5% in the year, which allows it to reduce the gap with the capitalization of the British Stock Market to 160,000 million dollars, close to the minimum, according to data from Bloomberg . Very far from the British and French stock markets is the Spanish market. Their combined market value drops to $0.53 trillion.

The British stock market is gradually losing relevance at the international level. First weighed down by the impact of Brexit, which has meant that other cities such as Frankfurt, Luxembourg, Amsterdam or Paris gained weight. And now because of the turbulence that is plaguing the national economy and the weakness shown by its currency against the dollar, but also against the euro. Along the way, London has tried in the last year to promote a legislative change to encourage IPOs and recover part of the pulse that Amsterdam has gained in these years.

Within the French stock market, the Cac 40 has accumulated a drop of 19.4% in the year, in line with the 20.8% of the Euro Stoxx 50 and below the 6.6% of the FTSE 100. In its ranks it has securities such as Thales and TotalEnergies, which managed to rise 51.7% and 8.2% in the annual balance thanks, in the first case, to the increase in European defense budgets, and to the rise in energy prices, in the second case.

In the third quarter there are several Cac 40 stocks that have managed to weather the market instability with force. Renault has managed to add 17.6% while luxury firms such as Hermes, Pernod Ricard and LVMH register increases of 14%, 8.7% and 4.9%, respectively, thanks, among other causes, to the gradual withdrawal of anti-Covid measures in China and the reopening of its main cities.

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