The FTSE 100 rose 21.5% last year, outperforming both the EuroStoxx 600 (+17%) and the S&P 500 (+16%). That outperformance is largely due to the index's composition, with banking and mining stocks representing a high proportion.
For example, Standard Chartered climbed 84% last year, while Lloyds rose 79%, in line with several other European banks. Indeed, investors had largely turned their backs on the sector after the 2008 financial crisis. However, renewed earnings growth and higher valuations have enabled banks to significantly outperform in recent years.
Meanwhile, the mining sector was boosted by a surge in precious metal prices: Fresnillo delivered the best performance in the index, soaring 435%.
Finally, the defence sector benefited from rising military budgets in Europe, with BAE Systems, for example, taking off 49% in 2025.
London's attractiveness under scrutiny
However, the index's strong performance should not mask the London market's lack of appeal. There were only 22 IPOs on the London Stock Exchange last year. And over the first nine months of 2025, London IPOs raised less money than… the Angolan stock exchange!
While Donald Trump's tariffs have prompted management teams to put some deals on hold, the London Stock Exchange suffers from a lack of attractiveness, particularly compared with the United States.
This is all the more so as the private funding ecosystem has expanded sharply in recent years. As a result, companies are listing later; as such, US markets are better suited to these transactions.
City bankers remain optimistic, however, hoping for a better 2026, driven by a handful of large deals.
