Did the war start on the stock market during the cold season? “Worst case scenario deeper stock market recession”

Last year, a listing carnival was held in Finland. A total of 29 companies were listed on the Helsinki Stock Exchange.

This year has started in a quieter mood. By Thursday, only two new listers had been added.

On a steady pace, this would mean less than 10 listings by the end of the year.

There is now a lot of uncertainty in the way of investors and companies considering listing. The war of aggression launched by Russia in Ukraine is the largest of them.

“The situation is what it is. I think we still have permission to expect a certain tightness from the second half. I hope to reach about 10 of its listers, ”he estimates Aktian Director of Investor Relations and Communications Lotta Borgström.

Listing requires investor demand, that is, investors who want to participate in listings and finance growth companies.

In addition, the companies want to be listed. Both need to be in place, he points out Nasdaq Helsingin managing director Henrik Husman.

“Investor demand is affected by a huge number of things starting with the economic outlook.”

“Now consumer confidence has plummeted. As a result, there may be less demand for IPOs, ”says Husman.

Good and bad signs

Uncertainty in the market can last a long time. It is not self-evident that a quick solution will be found to the war in Ukraine.

Even before the start of the war, the halt in the rise in stock prices last autumn raised questions about what the year of listing will be like in 2022.

According to Husman’s assessment, the uncertainty about the future will affect the willingness to list more than the actual fall in prices.

“In connection with the war, there have been wild fluctuations within the day. The general index of the Helsinki Stock Exchange may have moved five percent during the day, ”Husman points out.

On the positive side for the stock market, there are persistent factors that favor listings.

Even at a slightly lower cost, it is possible to enter the stock exchange if the company implements only the necessary listing measures in accordance with the instructions.

In addition, more information about smaller listed companies is available, notes Espoo-Kauniainen Share Savers chairman Jussi Koskinen.

“The long-term trend is that the number of listings is growing,” Koskinen estimates.

More than 10 years ago, a longer cold season began on the Helsinki Stock Exchange as a result of the financial crisis.

The increased willingness of smaller, early-stage growth companies to list on the First North marketplace is an example of the lowering of the listing threshold in Finland.

Despite the positive pull factors, it is important to be prepared for the fact that not all of the coagulations seen in the Nordic countries, Europe and the United States are promising a quick solution.

“The worst-case scenario would probably be a deeper stock market recession, with which stock prices would still dive significantly from the current or, alternatively, the escalation of the war,” Koskinen concludes.

See all Marketplace broadcasts here.

By Editor

Leave a Reply