Tuesday, Oct 22

Europe is biggest drag in slump in 2018 equity raising

European equity raising slowed sharply in 2018, making it the biggest drag on falling global activity.
21.12.2018 - 13:15

Global equity capital markets’ (ECM) proceeds fell to $688 billion in 2018 from $781 billion in the same period of 2017 according to data as of Dec. 17.

“Political uncertainty across Europe has not helped, but the real surprise was the slowdown in European macroeconomic growth,” said Craig Coben, vice-chairman of global capital markets at Bank of America Merrill Lynch.

THE EUROZONE ECONOMY GREW AT ITS SLOWEST PACE IN 4 YEARS

“Against such a backdrop, banks have to carefully curate the offerings they are underwriting, ensuring that the equities stories are properly presented, appropriately sized and meticulously communicated,” he added.

European ECM proceeds were at their lowest since 2012, falling 38 percent to $142 billion. Initial public offering (IPO) proceeds in the region fell 5 percent to $41 billion.

The eurozone economy grew at its slowest pace in four years in the third quarter of 2018, while employment growth also eased during the period, amid worries that tighter monetary conditions in the United States could further weigh on the global outlook.