Source: Reuters/Sergio Moraes A surfer watches the waves from Mirante point as heavy surf pounds a section of Arpoador beach in Rio de Janeiro Just when investors thought it was safe to go back in the water, Asia’s equity markets have sent them running for the shore once more. The dramatic reversal in risk appetite that followed a US pledge to unwind an unprecedented monetary stimulus has knocked equity indices down by 10%–20% across Asia, putting paid to a host of IPOs across the region. Periods of such volatility are nothing new in Asia’s...Read more
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The hunt for yield has proven as important in Asia’s equity capital markets as it has in the region’s booming bond markets, with REITs and similar plays generating huge interest. Those dynamics, however, are changing as investors review their allocation strategies.
Banks and investors are finding that the derivatives business can pay dividends amid an uptick in volatility and higher trading volumes.
Asian issuers may have missed the prime time for issuing convertibles, but the rising yield environment means CBs are more competitive than conventional bonds.
Spin-off equity raisings, particularly from the city’s hospitality sector, are helping Hong Kong close the gap on rival Singapore. The recent shift in US yields, however, has cast a shadow over the business trust, the city’s newest equity product.
Malaysia may not live up to last year’s bumper IPO volumes, but strong domestic demand and new equity instruments are keeping the market active even in a period of rising global volatility.
Many companies had hoped to emulate the success of a hugely popular offering of shares in Matahari Department Store in March. But the end to a prolonged market rally has left lofty price targets looking unrealistic.
The record listing of the Bangkok SkyTrain infrastructure trust has underlined Thailand’s potential to become one of the region’s most active equity capital markets. Demand for yield-based instruments remains strong despite a change in global sentiment.
