LONDON: The UK has surpassed India as the world’s sixth-largest equity market for the first time in almost nine months as a weaker pound boosted the appeal of heavyweight exporters trading in London and Adani Group-led jitters weighed on stocks in Mumbai. The combined market capitalisation of primary listings in the UK, excluding ETFs and ADRs, reached about $3.11 trillion last week, some $5.1 billion higher than their Indian equivalents. That hasn’t happened since May 29.
James Athey, investment director at Abrdn, said investors are “seeing a deep value opportunity in the UK” following the declines in sterling and with government policy that is “less experimental.” Furthermore, the FTSE 100’s makeup of financials, commodities and defensives stocks is “almost the perfect combination for now,” he said.
After outperforming global equities last year, the UK’s FTSE 350 Index — which comprises stocks in the FTSE 100 and the domestically focused FTSE 250 — has gained 5.9 per cent so far this year, outpacing a 4.7 per cent increase in the MSCI All-Country World Index.
That’s partly been driven by record highs for the bluechip FTSE 100, which topped 8,000 points for the first time last week as its dominance by internationally-focused companies helps the benchmark benefit from weaker sterling. Still, the UK’s equity market capitalisation remains behind France after losing its place as Europe’s biggest stock market last year.
