Boards of companies thinking of listing in the US should know the grass isn't always greener

Donald Trump is doing an excellent job of demonstrating that US stock markets don't always outperform European ones.

- Nils Pratley

On-off tariff wars, threats to fire the head of the Federal Reserve and general unpredictability have prompted a reappraisal of boring old Europe. The S&P 500 is down 6% this year, versus a gain of 2.5% for the FTSE 100 index and a 3% improvement in the pan-European Stoxx Europe 600. The differences aren't enormous, but they mark a reversal from recent years.

Will that be enough to stop the "exodus" of UK and other European companies to the supposedly higher-valued and more liquid US markets? The thesis - plodding European versus dynamic US - has been the popular narrative for years as the likes of the plant hire group Ashtead, the plumbing group Ferguson and the Paddy Power-owning Flutter have moved their primary listings to the US. It has become obligatory to describe every departure as "another blow" to London.

Well, here's a "reality check" report from the New Financial thinktank that ought to be digested by any footloose board of a UK-quoted company that imagines its share price would be higher if only the listing was in the US. It ain't necessarily so.