EY-Parthenon data shows London listings collapsed in early 2026, though a robust pipeline points to recovery in the second half.
London's new listings market suffered a near-total freeze in the first quarter of 2026, with just two companies floating on the London Stock Exchange amid a confluence of geopolitical instability and sharp valuation resets in technology stocks, according to new analysis from professional services firm EY-Parthenon.
One listing raised £8.8 million on the main market, while the other raised £4 million on the Alternative Investment Market (AIM), the exchange for smaller growth companies.
The figures represent a stark reversal from the closing months of 2025, when issuance accelerated and market sentiment had improved significantly.
EY-Parthenon's UKI IPO leader Scott McCubbin attributed the slowdown to two principal factors: a sell-off in sectors perceived to be exposed to AI disruption, which weighed on valuations for technology and software companies, and the conflict in the Middle East, which introduced broader geopolitical instability and raised concerns around inflation and consumer demand.
McCubbin noted that while headline market declines had been relatively modest, sector-level volatility had risen sharply, making near-term execution more challenging for affected businesses.
Despite the absence of new listings, follow-on activity, whereby existing listed companies raise additional capital, remained resilient, with strong interest from both domestic and international investors.
The first quarter also saw the inaugural transaction on the LSE's Private Securities Market under the Financial Conduct Authority's PISCES framework.
This allows private companies to access a secondary trading platform without formally listing, while preserving an option to progress to the main market or AIM.
The UK picture reflected a broader global softening, though the worldwide data was more nuanced.
A total of 232 companies went public worldwide in Q1 2026, raising $40.7 billion, representing a 23% fall in deal count but a 36% year-on-year increase in proceeds, driven partly by a $4.47 billion defence listing in the EMEIA region, the largest IPO of the quarter globally.
Greater China led by deal volume with 69 listings raising $16.8 billion, followed by India with 54 and the United States with 27.
EY-Parthenon partner Grant Humphrey said geopolitical and policy dynamics were playing an increasingly decisive role in shaping IPO outcomes, creating tailwinds for energy, defence and aerospace, while demand remained resilient in AI infrastructure and healthcare.
McCubbin said the UK pipeline remained robust and advised prospective issuers to continue progressing their listing readiness so they could move quickly once market windows opened, adding that historical precedent suggested recovery could come swiftly once conditions stabilised.