London Market in “Terminal Decline”: Don’t Worry, IG Group’s Got a Rescue Plan

IG Group (LON: IGG), the well-known contracts for differences (CFDs) and spread betting broker, has launched a bold campaign to encourage British people to invest in local companies. The move comes as the London market sees an exodus of listed firms and demand for IPOs falls to historic lows.

“The UK stock market isn’t just struggling; it’s in terminal decline,” IG stated in its campaign. “We’re witnessing a mass exodus… This problem won’t solve itself. And if we don’t act now, the damage could be permanent.”

The broker is calling on policymakers to “step up with serious action.”

“This isn’t just about saving the stock market. It’s about securing our economic future. It’s time to get serious,” IG added.

Related: "We Don't Want to Lose Business Across the Atlantic"

A Policy Change Is Necessary

According to IG, the British public has a savings-first mindset that discourages investment in businesses. The broker cited figures showing that £294 billion is held in cash ISAs, even though the FTSE 100 delivered 6.8 times more returns than the average cash ISA over a 26-year period.

In an effort to change this mindset, IG last month launched a promotion offering new UK customers up to 8.5 per cent AER variable interest on deposited cash—double the Bank of England’s current 4.25 per cent base rate.

Though the offer is temporary and ends in August, it raises the question of whether an 8.5 per cent return on cash could push savers to consider stock market investments.

IG is also calling for an end to stamp duty on UK share purchases and wants the government to “reward those who back Britain.” It is urging for lighter regulations to remove the culture of fear around investing and to challenge what it calls the “cash ISA myths,” which “promise safety but deliver stagnation.”

As part of its new promotion, the broker is also offering up to £100 in UK shares to new customers. Meanwhile, eToro—fresh off its US listing—has introduced 4 per cent rewards in UK stocks for all spending made with its debit card in the country.

The Struggles of London

The challenges facing the London stock market are now clear. Wise recently joined CRH, Arm, and Flutter in moving away from the London Stock Exchange. A total of 88 companies delisted from the exchange last year.

Read more: Wise Eyes Wall Street - UK Fintech Plans US Listing After Record Year

At the same time, the market is struggling to attract new listings, with a 60 per cent drop in UK IPOs between 2022 and 2024.

Cash ISAs remain popular. In 2024, the number of cash ISA subscriptions rose by 722,000, while subscriptions to stocks and shares ISAs fell by 126,000.

“This isn’t just some abstract market problem; it’s a real threat to the future for everyday Brits,” IG stated. “At the heart of this is a deep-rooted issue: the UK’s savings-first mindset discourages people from investing and denies businesses the capital they need to thrive.”