The current ructions in the US stock market are making some companies re-think their plans to list in the US.
While the Trump administration has stepped away – perhaps temporarily – from its ambitious Liberation Day tariff scheme, the uncertainty this has brought to the US market is affecting the sentiment of corporate CEOs.
Sweden’s Klarna has already announced that it is postponing its US IPO and only yesterday CFD broker eToro said it was delaying its US IPO roadshow. We anticipate other companies will follow suit. Market volatility is never good for IPOs, but the level of uncertainty the Trump administration has injected into the newsflow may cause other companies to look elsewhere for listings.
This could be good news for the London Stock Exchange
International IPOs in the US over the last five years have seen an average price drop of 39.5% since listing, highlighting the growing challenges for foreign issuers there. Notably, half of UK companies that listed in the US since 2014 have now delisted, and of those still trading, seven are down compared to their IPO price.
Of the 20 British companies, raising over $100m, that have listed in the US since 2014, TEN have now delisted. Of the others, only THREE are trading above their IPO price and the rest are on average trading down by more than 70%.
The London Stock Exchange remains by far the biggest and most successful European exchange judged by amount of capital raised in Q1, with £7.4bn of equity capital raised through 84 transactions and 79 follow-ons. There were also five IPOs. This marks the strongest start to the year for the exchange since the first quarter of 2021.
The LSE trails at fifth place at the moment globally for Q1, with two Asian exchanges, Tokyo Stock Exchange and HKSE, ahead of it. Hong Kong in particular seems to be benefitting as the bourse of choice for Chinese companies that want to access foreign investment capital.
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Record breaking month for the London Stock Exchange
On 21 March, total value traded on the London Stock Exchange’s orderbook reached £16bn – the highest amount traded since September 19, 2008, and the 8th highest on record. Furthermore, auction trading hit an all-time high in March, with £54.4bn traded over the month. ETP trading also set a new record, with March 2025 becoming the highest trading month of all time, reaching £21.9bn in value traded.
“Over the past few years a significant amount of companies chose to list in the US citing higher potential valuations, more liquidity and ease of capital raising,” said Clive de Larrabeiti, a corporate finance adviser to London-listed Pineapple Power Corp LON:PNPL. “This may have now been eroded by the increasing uncertainty generated by their government’s imposition of a universal trade war and the dire effects of that on the financial markets. It makes me wonder if this activity could actually contribute to a significant change of fortunes for the embattled smaller companies sector on the LSE and the Alternative Investments Market.”
Issuers from 48 countries have equity listed on the London Stock Exchange’s markets and issuers from 93 countries have debt listed. This could rise if more issuers shy away from listing in the US. This is particularly the case for Chinese issuers, who will be looking for an alternative to listing in the US as the trade war between the US and China heats up.
China-based sources in the capital markets sector consulted by The Armchair Trader in March, prior to the Liberation Day tariffs announcement at the start of April, told us that London was being looked at more favourably by Chinese companies considering a listing in a non-Asia Pacific time zone.
The UK seems to be well-positioned thanks to its relative stability and neutrality. The country’s capital markets reform agenda currently being pushed through by the Labour government could also help the LSE’s prospects.
