UK

ESG funds listed on the London Stock Exchange have had substantial investor interest through December, capping off a particularly green year for the market.

After weeks of equity inflows, investors are primed for a rally in UK equities following this Thursday’s general election. Banks are hoping for strong issuance conditions through to January.

Voters go to the polls on Thursday to pick the next UK government, with the outside possibility of a far left Jeremy Corbyn-led Labour government keeping capital markets bankers awake at night. But the return of Marxism might hold some silver linings for them.

The Conservatives may push for further deregulation of the UK’s financial system after Brexit, including allowing dual-class share structures on London's main market, if they emerge victorious from the general election on Thursday. This would be a mistake — they should not put at risk London's high corporate governance reputation in order to seek to compete with New York or Hong Kong.

Another packaging company is hunting for better financing terms in the issuer-friendly European high yield bond market. Berry Global follows companies such as Crown, Ball, Smurfit Kappa, Owen-Illinois and Ardagh with an ambitious refinancing that could be priced as early as Thursday — the day of the UK general election.

Utmost International, the life assurance group which mandated leads to run investor meetings for a senior bond in mid-November, may have missed the issuance window this year as the primary market slows to a standstill around the UK's general election.

Phoenix Group Holdings, the UK life insurer, has stuck a deal to acquire ReAssure, the UK closed book life insurance division of Swiss Re, for £3.2bn in cash and shares.

Participants in the financial institutions bond market have displayed calm in the run-up to the UK general election next week. A lingering credit premium for the country’s banks, to cover for risks related to Brexit and the economy, has left investors feeling comfortable about any likely outcome of the vote.

Certain US private placement (PP) investors are beginning to fear a turn in the famously prudent market, towards a world with looser financial covenants. Let us hope this remains a fear and does not become reality.

While capital markets professionals might be preparing to pop champagne corks in the expectation of a Conservative Party victory in the UK’s general election on December 12, they should remember that the government’s key policy is appalling for the UK.

The Pebble Group closed 17% higher on Thursday after the UK promotional products company priced its £135.4m IPO on the London Stock Exchange after lowering the offer price to accommodate investor feedback.

Equity capital markets professionals are hoping that the Conservative Party emerges victorious from the UK general election on December 12, in the hope that issuance conditions will return to normal after a year of uncertainty. However, the possibility of modest market gains are outweighed by predictions of dire consequences should the Labour Party win.