Massive Cut in Stock Turnover
In March, the Vienna Stock Exchange recorded a dramatic decrease in stock turnover. The first three months of 2012 brought a decline in sales by 40%.
The Vienna Stock Exchange faces an enormous decline in trading activity. Already in January and February, stock turnover was down dramatically. In January, the decline reached 35% against January 2011. In February, the decrease amounted to 27.45%. As a result, turnover in February was the lowest since 2004.
Already in 2011, turnover decreased by 18%. The most dramatic impact was observed in December, where turnover fell by 50%. However, the previous month is expected to surpass December: a decline of 52% is anticipated. Also the German Stock Exchange recorded a decrease by 23% in March. All in all, stock turnover fell by 40% in the first three months of 2012.
Birgit Kuras, chief executive at Vienna Stock Exchange called for political support. "Now is a good time for fresh capital. The market has found solid ground, but there is still room for upside potential," Kuras said last week. She hopes that the new listings will also include privatizations of state-owned enterprises: "A look at the general effects of privatizations and public offerings on the development of the companies concerned, and thus also on Austria's economy, reveals the current political demonization of the Austrian capital market as incomprehensible, and consequently, damaging to the national economy."
Kuras plans to concentrate efforts on measures to attract capital increases and secondary public offerings (SPOs) by already listed companies and in this manner increase the free float. The larger the free float, the more attractive a stock is to investors, because of the higher liquidity. Most companies listed on the prime market already have a free float of over 40%, but some companies have additional potential.
Kuras´ colleague Michael Buhl called for abolishing the securities gains tax immediately and to treat equity and debt equally. Moreover, the company tax should fall, Buhl said. Finally, employee participation programs must be supported. The introduction of new property taxes would cause a further reduction in the attractiveness of Austrian shares.
In March, RCB (Raiffeisen Centrobank) showed the largest trading volume (€ 353.4m). Deutsche Bank´s turnover was € 350.2m, followed by Erste Group (€ 325.1m), Morgan Stanley (€ 298.6m), UBS (€ 263.8m) and Credit Suisse (€ 247.2m). In the first quarter of 2012, Deutsche Bank ranked first (€ 1,074m), followed by RCB (€ 985.7m), Morgan Stanley (€ 850.4m), Erste Group (€ 848.5m) and UBS (€ 744.8m).