London Stock Market: ‘Switch has now been flicked’

Peel Hunt’s boss predicts a rebound in activity amid a’shift of sentiment’

According to the stockbroker who predicted last year a “doomsday loop” at the exchange, the London stock market is turning a corner.

Steven Fine, the chief executive officer of City Stockbroker Peel Hunt said that there were signs of improvement and declared that London’s stricken stock exchange was recovering. The exchange has struggled to attract floats, and seen an influx of companies leaving.

Mr Fine said, “We had 10 bad quarters of this industry… But now it’s much better than before.”

He said that a “switch” had been flipped, adding: “There’s been a change in sentiment. This is a good indicator for a recovery in activity in the next quarter.”

Mr Fine cited the recent floatation of Raspberry Pi by Peel Hunt as an example of improved sentiment. The shares jumped almost 40% on the first day of trading.

The London Stock Exchange Group and Haleon, which sold shares in the following months, are both evidence of the market’s health, according to Mr Fine.

Peel Hunt warned last year that some parts of the market had become “stuck in a doom loop”.

As a result, fewer investors bought stocks and their prices continued to fall. The UK discount was used by overseas investors to purchase British companies on the cheap. This meant that there were fewer shares to own.

Peel Hunt warned the UK index of smaller businesses could disappear by 2028, if it continued to decline.

Mr Fine explained that a combination better GDP figures, signs of easing inflation and expectation of falling interest rates all contributed to the improved mood on stock markets.

A more stable political environment is also helpful.

He said: “They are all very good people, whether it is Sunak and Hunt or Starmer & Reeves.” They will both do a fantastic job running the country.

Peel Hunt, a broker in the UK, hopes that Raspberry Pi’s floatation will revive interest among companies to tap into the stock market.
Mr Fine stated that the London Stock Exchange’s outflows had probably peaked.

He said, “We shot ourselves in the feet very well in this country.”

Peel Hunt’s loss was greater in the period ending March 2024. The pre-tax loss was £3.3m, compared to £1.5m the previous year.

Stockbroking was the main culprit, with revenues falling 12pc to £29.6m . This was offset by a 39pc increase in investment banking charges to £32.6m.

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