The FTSE 100 is set to end the year behind its international peers after eking out a minor gain through 2023.
London’s flagship index is trading up 2.47 per cent on its opening mark in January after a tumultuous year in which listed firms have been shaken by inflation and geopolitical concerns.
The blue-chip index reached a high of 8,047 in February but struggled to regain its form after a banking crisis spooked global markets in March.
Comparable indices in New York have rocketed however, with the S&P 500 climbing over 25 per cent across the year and the Nasdaq 100 rising 55 per cent.
“Britain’s blue-chip index still appears unloved with attention grabbed by the bright lights of Wall Street and the tech-heavy makeup of New York’s exchanges, with a frenzy for all things AI fuelling buying behaviour,” said Susannah Streeter, head of money and markets at Hargreaves Lansdown.
“Even though the Brexit hangover has eased, the UK’s stagnating economy and volatile political scene of recent years appears to be putting off investors.”
Across the channel, markets have similarly roared ahead of London despite similar gloomy economic pressures weighing on business. Germany’s DAX index, tracking 40 top listed companies in the country, has climbed 19 per cent through the year, while the Eurostoxx 50 has risen over 17 per cent.
Meagre growth on London’s blue-chip index comes amid a bruising year for the London Stock Exchange in which fresh listings on the bourse have dried up.
A slew of firms have also opted to ditch their listing in the capital or snubbed an IPO in London to float overseas.
While inflation in the UK is proving more stubborn than in the US and Europe, analysts at Hargreaves Lansdown say improving economic conditions next year could provide a boost to the value of listed firms in the UK.
“It may be a slower process, but inflation is heading in the right direction in the UK. A general election is in sight, which may also help spark enthusiasm,” Streeter added. “The resilience of UK consumers, and the underlying economy, may once again exceed expectations in 2024.”
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