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Speaker 1: Bloomberg Audio Studios, podcasts, radio news. This is the Bloomberg

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Speaker 1: Day Bake You At podcast, available every morning on Apple,

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Speaker 1: Spotify or wherever you listen. It's Wednesday, the eleventh of

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Speaker 1: December here in London.

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Speaker 2: I'm Caroline Hepka and.

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Speaker 3: I'm Stephen Carroll. Coming up today. London's IPO fundraising falls

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Speaker 3: behind Omans as low valuations and week liquidity push companies

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Speaker 3: to list elsewhere.

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Speaker 1: Bloomberg learns that the Biden administration is weighing new harsher

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Speaker 1: sanctions against Russia's lucrative oil trade.

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Speaker 3: Plus surprising resilience versus Trump surprises, we bring you Bloomberg

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Speaker 3: Economics Outlook for the year ahead.

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Speaker 1: Let's start with a roundup of our top stories.

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Speaker 3: London stock market now ranks worse than Oman for IPOs,

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Speaker 3: once irregular and the global top five. The UK is

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Speaker 3: now only pulling in a billion pounds a year in fundraising.

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Speaker 3: Bloomberg James Wilcock has more.

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Speaker 2: Picture the heydays.

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Speaker 4: If you thousand and six, when the UK IPO market

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Speaker 4: was a fifty billion pound juggernaut, beating New York and

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Speaker 4: the home for a sixth of all m and A

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Speaker 4: money raised that year now it's raking in just two

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Speaker 4: percent of that high. Far from topping the rankings comes

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Speaker 4: in twentieth Poor valuations and risk averse local investors are

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Speaker 4: seeing Britain full far behind new financial hubs in Asia

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Speaker 4: and the Middle East. The UK government is attempting to

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Speaker 4: change that with a wave of reform, but companies are

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Speaker 4: already moving where the money is. Forty five firms of

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Speaker 4: left London exchanges this year, the highest number since twenty

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Speaker 4: ten still listed in London. James Wallcock Bloomberg Radio.

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Speaker 1: Trade unions say the UK government's pay plans are deeply offensive.

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Speaker 1: Unison and the Rural College of Nurses are among the

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Speaker 1: groups proposing a two point eight percent pay rise for

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Speaker 1: NHS staff next year. Paul Johnson from the Institute of

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Speaker 1: Fiscal Studies says much of the anger comes from salaries

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Speaker 1: lagging behind.

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Speaker 2: During the cod.

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Speaker 5: Period, public sector workers did lose out, So what I

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Speaker 5: think the unions will be upset about is that's not

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Speaker 5: making up any of the gap that has opened up.

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Speaker 5: But given the constraints facing the Chancellor, I think it's

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Speaker 5: pretty hard to argue for more.

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Speaker 1: That was the ifs's Paul Johnson, the chance of Rachel

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Speaker 1: Reeves has said above inflation pay rises would only be

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Speaker 1: offered in future if they could be funded by improvements

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Speaker 1: in productivity. But the government now has to balance improving

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Speaker 1: public infrastructure and growth while reckoning with a public sector

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Speaker 1: unhappy with their pay at the risk of strike action.

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Speaker 3: Israel has increased its attack on military sites in Syria,

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Speaker 3: targeting hundreds of locations including airfields, weapons production sites, and warehousers.

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Speaker 3: The Israeli military claims the strikes are to prevent strategic

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Speaker 3: weapons from falling into the hands of terrorists. Here is

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Speaker 3: Israeli Prime Minister Benjaminetta Niahu.

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Speaker 6: We want releadship with new regime in Syria, but if

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Speaker 6: this regime allows Iran to the established it out in Syria,

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Speaker 6: or allows the transfer of Ranian weapons or any other

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Speaker 6: weapons to his wee la or a taxas sporn forcefully.

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Speaker 3: Net Now, whose comments came as Israel was forced to

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Speaker 3: deny reports its forces advanced on Syria's capital, Damascus after

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Speaker 3: its seizure of a buffer zone between the countries drew

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Speaker 3: condemnation from Arab states. Meanwhile, the leader of the rebel

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Speaker 3: group HTS, which toppled a sad's regime says the world

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Speaker 3: does not need to fear Syria. Abu Muhammad al Jaelani

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Speaker 3: insists the country will be rebuilt and a seeking stability,

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Speaker 3: not conflict.

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Speaker 1: The Biden administration is considering new sanctions on Russia's oil

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Speaker 1: trade to tighten the squeeze on the Kremlin's war machine.

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Speaker 1: Bloomberg understands that the potential measures could target foreign buyers

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Speaker 1: of Moscow's crude and its shadow fleet of tankers, which

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Speaker 1: are used to transport its oil. The US already bands

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Speaker 1: imports of russia oil, but new restrictions would upend more

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Speaker 1: than two years of policy set after Russia's invasion of

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Speaker 1: Ukraine in twenty twenty two. Now, it's hope that the

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Speaker 1: move would increase pressure on Putin before President elect Trump

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Speaker 1: takes office and gives Ukraine more leverage in any potential

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Speaker 1: negotiations to end the war.

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Speaker 3: The suspect and the fatal shooting of United Health executive

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Speaker 3: Brian Thompson is fighting interstate extradition to face a second

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Speaker 3: degree murder charge.

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Speaker 4: During a hearing.

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Speaker 3: Yesterday, Luigi Mangioni's lawyer said that his client will contest

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Speaker 3: any request to move him from Pennsylvania, to New York.

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Speaker 3: Before entering the courthouse, mange Oni shouted to the press

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Speaker 3: about an insult to the intelligence of the American people

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Speaker 3: as he was physically dragged into the building.

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Speaker 4: Clearly out of.

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Speaker 3: That was Luigi Mangioni there, expressing his frustration with the

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Speaker 3: US healthcare system. The twenty six year old was arrested

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Speaker 3: in Altoona, pen Sylvania, after a five day manhunt following

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Speaker 3: the December fourth attack on Thompson in Manhattan.

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Speaker 1: Emmanuel Macont is aiming to name a new prime minister

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Speaker 1: by tomorrow as he seeks to build a coalition of moderates.

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Speaker 1: Proven understands that the French president is meeting with major

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Speaker 1: parties to former cabinet that won't immediately fall to a

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Speaker 1: no confidence vote. According to a close official, Macmont will

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Speaker 1: aim to avoid a new legislative election for more than

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Speaker 1: two years when his term ends, despite expectations for a

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Speaker 1: fresh vote.

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Speaker 2: As soon as next July.

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Speaker 1: He's under pressure to move quickly as the government's collapse

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Speaker 1: has left France without a twenty twenty five budget, and

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Speaker 1: emergency legislation will be needed to keep the state going

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Speaker 1: by January.

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Speaker 2: Those are our top stories.

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Speaker 3: On the markets to quiet start this morning. As market's

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Speaker 3: away the USCPI report at one thirty pm. Chinese and

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Speaker 3: Hong Kong stocks are modestly lower. We're looking at the

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Speaker 3: hangsanging down by six of one percent. Investors are waiting

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Speaker 3: any signals of further stimulus to come from the two

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Speaker 3: day Central Economic Work Conference, which starts today. The US

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Speaker 3: dollar is trading flat. Oil prices are rising seven tenths

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Speaker 3: on Brent cruge to seventy two dollars and seventy cents

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Speaker 3: as the US is mulling new sanctions on Russia.

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Speaker 1: Now in a moment, we'll bring you more on another

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Speaker 1: unhappy record for London's IPO market, plus what Blueberg Economics

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Speaker 1: is expecting for next year. Yes, we're coming to that

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Speaker 1: time of the year where we're thinking about twenty twenty five.

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Speaker 3: With another story that caught Arry this morning, school trips

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Speaker 3: could be a key part of the UK's reset of

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Speaker 3: relations with the EU. We're not sending ministers with piles

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Speaker 3: of school children across borders, although that's quite a fun

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Speaker 3: reality TV idea that I've just come up with. But

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Speaker 3: our colleagues Alex Wickham and Lamelegan have been reporting that

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Speaker 3: Kirstarmer is trying to negotiate deals with individual EU countries

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Speaker 3: to allow school groups to travel here using their national

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Speaker 3: Idea entity cards rather than having to get passports for

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Speaker 3: their journeys as they now have they currently have to.

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Speaker 3: So France in the UK already have one of these arrangements.

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Speaker 3: The governments now are talking to Germany about a similar one.

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Speaker 3: This is the idea is that, you know, because there's

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Speaker 3: been this huge drop on the number of school childs

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Speaker 3: who've been able to travel to the UK.

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Speaker 1: It's from down by about a third actually from Europe,

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Speaker 1: and it's very very lucrative. It brings in lots of

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Speaker 1: tourism pounds. But you know, every increase in costs for

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Speaker 1: schools is quite a big deal. I mean, the average

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Speaker 1: cost in the UK for going abroad is sort of

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Speaker 1: at least about four hundred pounds, goes up sometimes it's

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Speaker 1: two thousand pounds. So when there's added friction in terms

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Speaker 1: of passports, that makes it more difficult. And yeah, the

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Speaker 1: UK wants a bit of that tourism pie.

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Speaker 3: Yeah, indeed, that's one of the areas that we're watching

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Speaker 3: this morning. Let's bring you more now though on our

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Speaker 3: top story, around the UK's place in global IPO rankings.

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Speaker 3: Fundraising for public offerings dropped by some nine percent this year,

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Speaker 3: on top of what was already a pretty unhappy track

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Speaker 3: record for the London market in recent years. We've got

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Speaker 3: our deals reporters with the GOP on with us for

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Speaker 3: more this morning. Good morning to you. So that the

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Speaker 3: UK now ranked below Oman, Luxembourg and Malaysia in terms

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Speaker 3: of fundraising? Is the situation as bad as it sounds?

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Speaker 7: Unfortunately, Yes, it's every bit as bad as it sounds.

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Speaker 7: London used to be one of the premier listing destinations

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Speaker 7: in the world, right, It used to be in set

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Speaker 7: of the top five venues globally. Now it's at about

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Speaker 7: number twenty. We haven't had any large listings this year

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Speaker 7: here either. We haven't had a single deal raise more

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Speaker 7: than say, two hundred million dollars. Compare this to even

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Speaker 7: markets in the Middle East, where billion dollar listings are

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Speaker 7: quite common. London is beginning to look a bit dismal.

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Speaker 1: Indeed, Yeah, so what's gone wrong then for the UK's

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Speaker 1: IPA market.

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Speaker 7: It's not just one factor. There are several factors that

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Speaker 7: play here. Perhaps the biggest is the decline in valuations

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Speaker 7: for stocks listed on the market. It's such a deep

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Speaker 7: discount to the US and even to munch of Europe

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Speaker 7: and in in the UK market tend to be more

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Speaker 7: risk covers. It's a market that has historically been known

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Speaker 7: for healthy yields and dividend payments. This means portfolio managers

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Speaker 7: in London are typically sort of reluctant to back the

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Speaker 7: type of growth firms that tend to dominate the IPO market.

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Speaker 7: And then, perhaps more importantly, regional markets, especially in places

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Speaker 7: like the Middle East and India, have become quite robust.

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Speaker 7: London used to be a big destination for international firms,

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Speaker 7: but now many of them are just listing in their

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Speaker 7: home markets.

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Speaker 3: Is there one place in particular that sort of strong

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Speaker 3: competition for the type of IPOs of the UK used

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Speaker 3: to attract? I mean, is this really all about all

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Speaker 3: the money going.

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Speaker 4: To the US?

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Speaker 2: It actually is.

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Speaker 7: While there's a lot more competition now from regional markets globally,

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Speaker 7: the biggest competitor is still in New York. Global capitalist

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Speaker 7: pool there and investors worldwide can access the US market,

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Speaker 7: which makes New York really attractive for firms seeking a

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Speaker 7: wide and deep investor base. A number of UK listed firms,

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Speaker 7: including the likes of CRH and most recently Ash died

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Speaker 7: this week, have said them moving their primary listings to

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Speaker 7: New York and even more worryingly, perhaps large homegrown UK

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Speaker 7: firms continue to flock to the US. We had ARM

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Speaker 7: most recently choose New York over London for its IPO.

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Speaker 7: Now this fear that fintech Revolute will follow suit.

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Speaker 1: Yes, so can anything be done to revive the market

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Speaker 1: in London?

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Speaker 7: UK authorities are very much sort of cognizant of the

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Speaker 7: problem and they are taking active steps. We saw the

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Speaker 7: biggest overhaul of listing rules this year. It was the

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Speaker 7: biggest in same more than three decades or so. The

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Speaker 7: new labor government is also more broadly looking at scrapping

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Speaker 7: regulation that hinders economic growth. But if you speak to

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Speaker 7: executives in the city, if we speak to bankers and executives,

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Speaker 7: they say other changes are needed. It's not just about

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Speaker 7: listing rules. One sort of challenge that's often cited is

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Speaker 7: around exec pay.

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Speaker 2: Pay for top.

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Speaker 7: Executives in the US is many times higher than in

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Speaker 7: the UK, which means UK firms also find it difficult

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Speaker 7: to compete for top talent. The second is to create

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Speaker 7: sort of a more robust investing culture in the UK

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Speaker 7: help narrow the valuation discount that is plague the market. This,

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Speaker 7: the idea is, could be done by sort of compelling

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Speaker 7: pension funds and retail investors to put more money into

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Speaker 7: the London market itself rather than internationally. But that's not

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Speaker 7: an easy task.

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Speaker 3: Of course, no indeed, and kind of a major one

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Speaker 3: to be tackled down the line as well. For now, Sweeter,

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Speaker 3: thanks so much for joining us kapinat there are Deals reporter.

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Speaker 7: Now.

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Speaker 1: The global economy is set for another year of SETI,

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Speaker 1: but on spectacular growth. That is according to the latest

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Speaker 1: look from Bloomberg Economics, which also points to risks of

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Speaker 1: a slowing labor market in the US and political uncertainty

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Speaker 1: in Europe. Joining US now as our chief europe economist

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Speaker 1: Jamie Rush for more on this, Jamie, good morning. Is

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Speaker 1: this a relatively optimistic outlook given all the uncertainty when

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Speaker 1: it comes to economic growth?

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Speaker 8: Well, in I guess you could. You could say it's optimistic,

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Speaker 8: and there's certainly lots of uncertainty, but I think there

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Speaker 8: are some reasons to imagine that when Trump gets into

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Speaker 8: office in January he may be a little bit more

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Speaker 8: cautious than he's sounded on the campaign trail. First, he's

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Speaker 8: got moderate voices in his administration, so there are people

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Speaker 8: who are going to be a position to power who

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Speaker 8: don't want the world economy to get to hell and

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Speaker 8: a handcock. If you look at his record the first

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Speaker 8: time around, and I'm not saying that's the perfect guide

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Speaker 8: we'll all do the second time around, but you can

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Speaker 8: see that they're actually very careful in the way they

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Speaker 8: designed the tariffs. So if you look at the list

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Speaker 8: of goods and services or goods that were tariffed in

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Speaker 8: the first first round and first trade War, you'll see

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Speaker 8: it was targeted really heavily on intermediate goods, on capital goods,

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Speaker 8: things that when you import them, you can spread the

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Speaker 8: costs of the tariff across the whole economy. What he

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Speaker 8: didn't do was put massive tariffs on iPads and consumption

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Speaker 8: goods more broadly, So this will limit the inflation impact.

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Speaker 8: If he goes around that route again, which we think

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Speaker 8: he will, then they will be relatively modest consequences globally.

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Speaker 8: And so I think these are all reasons to imagine

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Speaker 8: that he might be careful You've also got the discipline

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Speaker 8: of the market, right, So if he puts massive tariffs

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Speaker 8: on imports from China, that's going to destroy supply chains

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Speaker 8: for some of America's biggest companies, and he doesn't like

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Speaker 8: them stock market selling off. He's not going to go

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Speaker 8: on a massive fiscal expansion, probably because he'll face the

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Speaker 8: much higher yield in.

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Speaker 2: The bomb market.

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Speaker 8: So I think there are some things which will constrain him.

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Speaker 8: And if that's the case, then the global economy may

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Speaker 8: hold up just about.

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Speaker 3: Okay, Okay, So that's the the US and the global picture.

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Speaker 3: What about the UK. What's your outlook there?

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Speaker 5: Well?

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Speaker 8: I think the UK, I mean, growth is going to

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Speaker 8: be relatively slow, sort of like a one and a

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Speaker 8: half percent. We have the boost from the from physical

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Speaker 8: from everyone talks about the next stuff for the UK,

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Speaker 8: which is the tax on jobs, which is which is

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Speaker 8: going up. But there is a big fiscal loosening relative

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Speaker 8: to what was planned and they are going to spend

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Speaker 8: the next for forty billion pounds. So I think he

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Speaker 8: had that sort of that sort of boost from higher

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Speaker 8: spending in the in the economy set against the you know,

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Speaker 8: the the broader uncertainties that the world economy faces, of course,

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Speaker 8: of which Trump Trump is the number one probably so

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Speaker 8: I think. I mean the UK is looking like it's

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Speaker 8: going to grow slightly faster than the Eurozone, not as

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Speaker 8: fast as the US.

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Speaker 1: Yeah, what about Europe more broadly, I mean there's lots

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Speaker 1: of concern about the politics in France.

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Speaker 2: Are still German economy.

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Speaker 8: Yes, well, there is now a vacuum at the heart

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Speaker 8: of Europe, so we don't have a stable French government.

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Speaker 8: We don't have a German government, and we won't until

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Speaker 8: potentially until the middle of next year. It takes time

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Speaker 8: for coalitions to be formed. So the EU is basically

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Speaker 8: without much leadership and certainly no coherent, cohesive leadership, which

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Speaker 8: isn't where you want to be when you're when you've

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Speaker 8: got difficult decisions to make about trade and how to

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Speaker 8: position yourself with China, and of course we have serious problems. Germany,

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Speaker 8: as we all know, faces a real challenge to its

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Speaker 8: business model. We've done a lot of work on that.

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Speaker 8: We think that GDP is about five percent below where

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Speaker 8: it would have been had it carried on on pre

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Speaker 8: pandemic trends, and you can thank a slower China and

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Speaker 8: of the energy crisis and the long term increasing energy

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Speaker 8: costs for those for those shortfalls by and large, So

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Speaker 8: how do you tackle them? Well, they're not easy to fix.

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Speaker 8: You can't. We can't suddenly to be very difficult to

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Speaker 8: suddenly fix the energy pulsing in Germany, and you know

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Speaker 8: there's nothing they can do about China. So I think

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Speaker 8: the question for the next administration in Germany is are

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Speaker 8: they going to finally reform their fiscal rules, their debt

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Speaker 8: break which prevents them from borrowing anything even to invest

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Speaker 8: for their own futures. And if we see some reform there,

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Speaker 8: that maybe a change.

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