Prepare for a pivot in 2026: Q&A with James Taylor, Deutsche Numis’ Head of Investment Banking
After a lacklustre period for UK equity markets with low volumes and a dearth of IPOs, there are now some tangible signs of change. We caught up with our Head of Investment Banking, James Taylor, for his thoughts on the outlook for the second half of the year and beyond.
What is the outlook for UK equity market activity in the second half of 2025?
So far this year, we’ve seen a continuation of the trends of 2024. ECM volumes have been much lower than historic norms due to a combination of existing listed companies not issuing as much equity, fewer secondary sell downs, and a lack of IPOs. The broader macroeconomic picture has contributed to this in the UK, but also in other global markets. Then, in April, we had the Trump tariffs and the volatility this caused compounded things still further.
But as we look forward to the second half, there are a few interesting signs of a more positive outlook. From an IPO perspective, we are starting to see pitch activity levels rising and advisors are being appointed on deals. While these are mainly for 2026, we will potentially see some of that activity taking place towards the back end of the second half of this year.
Looking further out to 2026, we’re increasingly optimistic there will be significant IPO activity in the UK market and some large transactions, too. That could change the mood music and end the negative doom loop that there's been around the UK capital markets, particularly in the media.
I am strongly of the view that once we see one or two successful IPOs in London, we will see a significant change in sentiment. Private equity sponsors will be an important part of this. As soon as they get the sense that UK equity markets can provide them with a credible exit option to realise value, the change in mood will become self-fulfilling. James Taylor, Head of Investment Banking, Deutsche Numis
What about capital raising by existing listed companies?
On capital raisings more broadly, whilst activity levels have been low, when companies want to raise capital, they absolutely can. There was National Grid and Great Portland last year and then Pennon, Rosebank Industries, Coats Group and others this year. That gives us confidence that the market is more than fit for purpose. When companies seek capital in London, the market delivers.
We just need improved business confidence, and an increased ambition for UK listed corporates to raise equity to support either organic or inorganic growth.
What is the mood among your clients?
It would be naive not to recognise that it's still hard-going for many companies. Our clients are focusing on running their businesses and trying to be successful; we're there to support and advise them, particularly around capital markets and potential M&A. But for many companies, things still need to improve from a trading perspective, from a macroeconomic perspective and from a confidence perspective. Clarity around global tariffs will also be helpful.
That, of course, links to the broader environment of inflation, interest rates, consumer confidence and the government’s growth strategy.
Are the UK Government and other institutions being sufficiently supportive of UK equity markets?
The Government, London Stock Exchange and FCA are all working to convince international and UK companies that London remains an attractive listing venue. The Chancellor’s Mansion House speech earlier this month showed that London's capital markets and the UK financial services sector are rightly seen as crucial to the success of the Government’s growth strategy.
If you pick through the detail of the Mansion House speech, there's some interesting stuff in there. For example, the establishment of a London listings task force. It shows the Government is keen to keep the momentum going in terms of the market and regulatory reform that's been going on over the last couple of years.
We will have to wait and see how this develops, but so far this agenda supports our optimism for 2026.
What are the key factors that will shape UK equity capital markets in the second half of the year?
The top three are: US tariffs and how they develop, interest rates and whether the Bank of England matches current expectations for continued cuts, and the Autumn Budget.
While everyone subscribes to the Government's growth strategy, the question is: how do they get there? More specifically, it’s about the tax environment and what the Government will do to balance the books, and whether that hampers its ability to drive growth.
Finally, we must not underestimate sentiment, which can be self-reinforcing, and we’ve seen that over the last few years in a negative sense. But after the uncertainty – Covid, wars, tariffs – people are craving normalisation. They want to get back to business.
I am strongly of the view that once we see one or two successful IPOs in London, we will see a significant change in sentiment. Private equity sponsors will be an important part of this. As soon as they get the sense that UK equity markets can provide them with a credible exit option to realise value, the change in mood will become self-fulfilling.
When that sentiment pivots and there is greater confidence in the UK equity markets, greater activity levels will likely follow pretty quickly.
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After a lacklustre period for UK equity markets with low volumes and a dearth of IPOs, there are now some tangible signs of change. We caught up with our Head of Investment Banking, James Taylor, for his thoughts on the outlook for the second half of the year and beyond.
What is the outlook for UK equity market activity in the second half of 2025?
So far this year, we’ve seen a continuation of the trends of 2024. ECM volumes have been much lower than historic norms due to a combination of existing listed companies not issuing as much equity, fewer secondary sell downs, and a lack of IPOs. The broader macroeconomic picture has contributed to this in the UK, but also in other global markets. Then, in April, we had the Trump tariffs and the volatility this caused compounded things still further.
But as we look forward to the second half, there are a few interesting signs of a more positive outlook. From an IPO perspective, we are starting to see pitch activity levels rising and advisors are being appointed on deals. While these are mainly for 2026, we will potentially see some of that activity taking place towards the back end of the second half of this year.
Looking further out to 2026, we’re increasingly optimistic there will be significant IPO activity in the UK market and some large transactions, too. That could change the mood music and end the negative doom loop that there's been around the UK capital markets, particularly in the media.
What about capital raising by existing listed companies?
On capital raisings more broadly, whilst activity levels have been low, when companies want to raise capital, they absolutely can. There was National Grid and Great Portland last year and then Pennon, Rosebank Industries, Coats Group and others this year. That gives us confidence that the market is more than fit for purpose. When companies seek capital in London, the market delivers.
We just need improved business confidence, and an increased ambition for UK listed corporates to raise equity to support either organic or inorganic growth.
What is the mood among your clients?
It would be naive not to recognise that it's still hard-going for many companies. Our clients are focusing on running their businesses and trying to be successful; we're there to support and advise them, particularly around capital markets and potential M&A. But for many companies, things still need to improve from a trading perspective, from a macroeconomic perspective and from a confidence perspective. Clarity around global tariffs will also be helpful.
That, of course, links to the broader environment of inflation, interest rates, consumer confidence and the government’s growth strategy.
Are the UK Government and other institutions being sufficiently supportive of UK equity markets?
The Government, London Stock Exchange and FCA are all working to convince international and UK companies that London remains an attractive listing venue. The Chancellor’s Mansion House speech earlier this month showed that London's capital markets and the UK financial services sector are rightly seen as crucial to the success of the Government’s growth strategy.
If you pick through the detail of the Mansion House speech, there's some interesting stuff in there. For example, the establishment of a London listings task force. It shows the Government is keen to keep the momentum going in terms of the market and regulatory reform that's been going on over the last couple of years.
We will have to wait and see how this develops, but so far this agenda supports our optimism for 2026.
What are the key factors that will shape UK equity capital markets in the second half of the year?
The top three are: US tariffs and how they develop, interest rates and whether the Bank of England matches current expectations for continued cuts, and the Autumn Budget.
While everyone subscribes to the Government's growth strategy, the question is: how do they get there? More specifically, it’s about the tax environment and what the Government will do to balance the books, and whether that hampers its ability to drive growth.
Finally, we must not underestimate sentiment, which can be self-reinforcing, and we’ve seen that over the last few years in a negative sense. But after the uncertainty – Covid, wars, tariffs – people are craving normalisation. They want to get back to business.
I am strongly of the view that once we see one or two successful IPOs in London, we will see a significant change in sentiment. Private equity sponsors will be an important part of this. As soon as they get the sense that UK equity markets can provide them with a credible exit option to realise value, the change in mood will become self-fulfilling.
When that sentiment pivots and there is greater confidence in the UK equity markets, greater activity levels will likely follow pretty quickly.