On Friday, Bloomberg reported that UK equities endured record yearly outflows, as investors have lost confidence in the UK economy, according to data from EPFR Global.

So far this year, the data shows that roughly $26.3 billion has been withdrawn, which coincided with a 20% slump in the FTSE 250 Index. It was the biggest fall for the benchmark index since 2008. In contrast, the blue-chip FTSE 100 Index rose over 1%, based on its exposure to commodity stocks, which soared over the year.

According to Bloomberg, this marks the seventh year in a row where investors have attempted to exit UK markets.

Bloomberg wrote, “The country has been roiled by political and economic troubles this year. The onset of a recession, inflation at a 41-year high, two prime ministers resigning and the highest number of strikes since the 1980s helped trigger selloffs in domestic stocks and the pound.”

In the process, London has seen Paris take its title as Europe’s biggest stock market.

Marija Veitmane, a senior strategist at State Street Global Markets, said she is not optimistic about UK stocks in 2023 as, “we expect the market focus to switch from macro headwinds to microeconomics and earnings recession.”

She went on, “The UK is less likely to do well, as earnings and profitability of UK companies are not the strongest, which may lead to underperformance.”