Mr Fine pointed to the float of Raspberry Pi earlier this week, which Peel Hunt worked on, as evidence of improved sentiment. Shares spiked almost 40pc on their opening day of trading.
A £7bn equity raise for National Grid, the largest in a decade, and follow-on share sales in Haleon and the London Stock Exchange Group are also evidence of a healthier London market, Mr Fine said.
Peel Hunt last year warned that parts of the market were stuck in a “doom loop”.
Low prices meant fewer investors were buying stocks, sending their prices spiralling further down. At the same time, overseas investors were using the UK “discount” to buy British businesses on the cheap, meaning there were fewer stocks to own.
Peel Hunt warned that the index of smaller companies could cease to exist in the UK by 2028 if the decline continued.
Mr Fine said a combination of better GDP numbers, signs of easing inflation and expectations of falling interest rates were all contributing to the better mood in stock markets.
