Paris has overtaken London as the home of Europe’s biggest stock market, new analysis has revealed.

The French stock market now has a combined value of 2.823 trillion US dollars, marginally above the UK stock market which is worth 2.821 trillion US dollars altogether, according to figures from Bloomberg.

Whereas five years ago, when Britain voted to leave the EU, British stocks were worth 1.5 trillion more than France.

The fact that smaller and consumer-focused firms have been hit hard by an economic downturn, made worse by the energy crisis, high inflation, and recent market volatility, has dragged down the collective value of the UK’s listed companies, Bloomberg said.

Furthermore, a former Bank of England policymaker, Michael Saunders, told Bloomberg TV that the UK economy has been “permanently damaged” by Brexit, because it reduced the country’s potential output and resulted in reduced investment into UK businesses.

Meanwhile, France’s stock market has bolstered by luxury retail companies enjoying a post-Covid spending boost.

Louis Vuitton owner LVMH tops the French Cac 40 with a market capitalisation – meaning the total value of its shares – of 364 billion dollars, nearly double the runner up, L’Oreal.

Paris is also home to Gucci owner Kering SA, which has seen its share price jump by about a fifth over the past month.

Whereas big retailers on London’s blue-chip index, the FTSE 100, have seen their shares plunge throughout the year, with the likes of Ocado Group and JD Sports dropping by more than 40%.

Bloomberg said that the shift in stock market value is more an indication of UK stocks weakening, but that it also reflects the resilience of high-end brands.

Burberry Group, a FTSE 100-listed luxury brand, has bucked the trend of other retailers and enjoyed a nearly 10% uplift in its share price this year.

The market capitalisation calculations also reflect currency movements, Bloomberg added.

The pound has taken more of a hammering this year than the euro, dropping 13% in value against the US dollar this year while the euro has fallen by a milder 9.2% against the American currency.