Global markets welcome more listings but not Europe

Monde
On the 02/22/21 at 7:22AM

by

Fabrice Anselmi

The World Federation of Exchanges’s findings include a rising number of listed companies, driven by the financialisaton of Asia.

The World Federation of Exchanges (WFE) on Friday released its 2020 statistics, reporting an exceptional year for the financial markets, driven by Covid-19, the US election, Brexit and the vaccine announcements, which generated volatility comparable to that of 2008. In addition to the fact that the markets stayed open even during the worst days of the crisis, share prices recovered very rapidly, thanks to various supports for the economy. As a result, equity markets set records in trading value and volume, rising by 54% (with $137,630bn on regulated markets) and by 56% (with 38bn transactions) vs. the previous year. Europe expanded far less in value terms (+26% in EMEA), with a 68% increase in the number of transactions. Also as a result, global market cap for the first time crossed the barrier of $100,000bn in November, ending the year at $109,210bn, up by 20% vs. the end of 2019.

Contrary to popular wisdom, the number of listed companies actually rose, by 1.1% worldwide vs. 2019 (+527 to 47,919 companies), driven mainly by Asia (+2.8% to 23,391) and the Americas (+1.1% to 10,529), while Europe lost 1.6% listings, to 14,000. This was the steepest drop in four years in the number of listed companies in Europe, while that number has risen rather steadily in the US and Asia.

The number of IPOs and inflows from those IPOs also rose considerably in 2020 vs. 2019, by respectively, 26% (1485, including 256 in December alone) and 37% ($278bn). The highest numbers were in Asia, with 945 IPOs (including 234 on the Shanghai Stock Exchange and 161 on the Shenzhen Stock Exchange), vs. 287 in the US (184 IPOs on the Nasdaq) and 253 in Europe. The number of direct listings rose by 30% to 1,360, most of them in Asia. Inflows from recapitalisations rose by 32%, to $651bn.

Derivatives exchanges also expanded very sharply in all types of options and futures (equities, indices, currencies and commodities), with the exception of interest-rate derivatives. The same goes for the 7,941 exchange-traded funds covered, which generated $30,426bn in trading volumes (+42%).

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