Pubs, pints and the pound: how an England World Cup win could lift UK spending

Football can’t fix the economy – but XTB research suggests a winning summer could give stocks, confidence and the high street a welcome boost

With the start of the World Cup only around the corner, new analysis from investment platform XTB suggests an England victory could provide a boost for UK stocks, consumer confidence and spending.

Research by XTB found that stock markets in countries that went on to win the World Cup recorded an average gain of 3.2% during the tournament and in the months afterwards, compared to an average gain of 1.4% for the FTSE 100 during England’s last five World Cup campaigns.

The findings suggest a successful England run could provide a lift for sectors such as hospitality, retail and leisure, particularly as pubs, bars and restaurants prepare for increased spending during the tournament. Historically, major sporting victories have often coincided with stronger consumer sentiment and higher spending across food, drink, travel and entertainment.

The biggest market reaction among recent World Cup winners came from Argentina, where the Merval Index surged 9% during the 2022 tournament and in the month after victory. Italy’s stock market also gained 5% after winning the World Cup in 2006, climbing 16% in the year, delivering one of the country’s strongest annual market performances of the 2000s. The DAX also rose by 11% in 2014, when Germany won the World Cup in July of that year.

England’s own World Cup history has produced mixed results for the FTSE 100. The strongest performance came in 2010, when the FTSE rose 6% during the tournament and in the following month as markets recovered from the financial crisis, while England’s semi-final run in 2018 coincided with a 2.7% fall in the index amid uncertainty surrounding Brexit negotiations. More recently, the FTSE gained 2.3% during and shortly after the 2022 World Cup, where England reached the quarter final stages, despite inflation and rising interest rates weighing on global markets.

Kathleen Brooks, Research Director at XTB, says: “Major sporting events like the World Cup can have a surprisingly positive effect on investor sentiment, particularly when national teams perform well. While football success does not change economic fundamentals overnight, it can boost confidence among consumers and investors, which can feed through into markets in the short term.”

“Historically, stock markets in World Cup-winning countries have tended to outperform during and immediately after the tournament. For the UK, an England or Scotland victory could provide a welcome lift for sectors tied to consumer spending, including hospitality, retail and leisure, at a time when the economy continues to face a challenging backdrop. However, any longer-term gains for UK equities would still depend on inflation, interest rates and the wider global economic outlook.”