Equities: after the flood

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Equities: after the flood

Equity capital market bankers are in a state of shock. It’s not simply that their market has seen record volumes of issuance this year. It is rather that the international equities market has gone through an entire lifecycle of change in less than 12 months. Michael Peterson reports

Only a year ago the new economy was still a wholly American concept. There had been no more than a couple of internet IPOs in Europe, and these equities were languishing below their issue price. Germany's Neuer Markt was the home of small traditional media companies, not internet start-ups. And the rest of Europe seemed to have few growth companies of any description.


       

Since then, Europe has seen a deal frenzy, with investors clamouring First for consumer internet stocks, then business-to-business stories and then technology providers. The market has gone through cautious optimism, heady euphoria, a frantic sell-off and back to caution. European retail investors have caught the day-trading bug and become a key part of many deals. And all the while, there have been phenomenal volumes of issuance from large established companies, supplying a continent-wide hunger for equity.



The sheer volume of issuance has made life difficult for issuers and investment bankers.




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