Decoupling In Global IPO Markets

Although the chart below is from last week's article, I think this speaks volume of what has been happening today.

The chart essentially shows Hong Kong grabbing the top spot in the IPO financing market.
According to the Wall Street Journal,

``After a hiatus of several years, Hong Kong's stock exchange is again the world champion of IPOs. It probably shouldn't get too comfortable with the title.

``As of Monday, $26.81 billion has been raised through initial public offerings in Hong Kong this year, according to Dealogic. That is well above the $17.11 billion raised on the New York Stock Exchange, which stood at No. 2 in the global rankings.

``It has helped being the exchange best-positioned at the moment to connect foreign stock investors with China, a beacon of growth in a world still recovering from recession. "We've been in the right place, at the right time, in the right markets," says Ronald Arculli, chairman of Hong Kong Exchanges & Clearing Ltd., known as HKEx.

``This year's total falls far short of the $43.9 billion Hong Kong raised in 2006, when it also topped the global list for IPO issuance. But under the circumstances, it is a worthy achievement. Partly reflecting that success, HKEx's share price is up 90% this year, and more than 150% from its lows in March.

``Perhaps the bigger achievement, though, is HKEx's progress in attracting major listings from outside mainland China and Hong Kong, a goal it has pursued for years but one that has remained elusive until recently." (bold emphasis mine)

Read the rest here.

Additional observations:

-While the article focuses on Hong Kong's lead role in global IPO financing today, what seems missed is that 8 out of the 10 largest IPO markets have been spread among the major emerging markets particularly China, Brazil and India with only 2 from the developed world- 2nd placer New York Stock Exchange (NYSE) and fourth placer Nasdaq.

-European bourses appears to be absent from the contention.

-China and Brazil's bourses are closing in on the marginal lead held by both NYSE and Nasdaq. This implies that if present trends continues, then the US may lose its current standings and perhaps in 3-5 years the top 3 spots could be secured by Hong Kong and China while Brazil may squeeze ahead of the Nasdaq.

-global wealth intermediating activities appears to be concentrated on emerging markets as represented by the dominance of the emerging markets in the Global IPO markets today.