Paris has extended its lead over London as Europe’s largest stock market amid an exodus of companies from the City. 

The London market is now $250bn (£204bn) smaller than its French rival, according to data from Bloomberg, as fears grow that the London Stock Exchange (LSE) is losing its allure. 

Last November, London was for the first time stripped of its crown as the largest centre for trading equities in Europe after being leapfrogged by Paris. 

However, it has fallen even further behind in recent months following a weak performance by the FTSE 100 and amid a procession of businesses snubbing the Square Mile for New York. 

The market value of stocks in Paris has jumped by more than a tenth to $3.1 trillion between November and this week, according to the data, while London’s combined market capitalisation has only grown by 2pc to $2.9 trillion during the same period. 

Paris’ CAC 40 index has strongly outperformed London’s blue-chip index this year, climbing by more than 8pc since January compared to a meagre 0.1pc rise for the FTSE 100. 

It marks a significant reversal of fortunes in the last decade with UK stocks almost $2 trillion larger in dollar terms than their French rivals at one point in 2014 when the pound was much stronger.

London has gained a reputation as an “unloved” market in recent years as economic malaise and persistent political uncertainty has pushed international investors to look elsewhere.

Concerns about the City’s position were exacerbated in recent weeks when building material giant CRH became the latest company to leave the London stock market for New York, while British technology darling Arm also said it was shunning London for its bumper listing. 

The European Central Bank (ECB) has also engineered a raid on the Square Mile, telling lenders that they must base staff in the EU if they are responsible for significant trading activity on the Continent after the UK left the bloc.

Goldman Sachs said on Wednesday that a senior banker at its London office is set to relocate to Paris to lead the development of the Wall Street giant’s European trading business. 

Goldman moved into a new, 9,000-square meter Paris headquarters last year, with its headcount more than doubling in the country in recent years. 

The ECB previously said it had identified 56 groups of traders who should be doing their jobs from within the European Union following a lengthy investigation into whether the institutions are seeking to dodge post-Brexit rules.