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"Impossible to be optimistic in the current context" (Euronext) - Finance

“Impossible to be optimistic in the current context” (Euronext) – Finance

“It is impossible to be optimistic in the current context” of war in Ukraine and galloping inflation, said Thursday Vincent Van Dessel, CEO of Euronext Brussels, on the sidelines of the presentation of the half-yearly results of the stock market.

The Bel 20 lost 14.5% in the first six months of 2022. Its little brother, the Bel Mid, which includes smaller stocks and therefore less sensitive to the macro-economic situation, is doing a little better (-13.8%).

Volumes processed per day in the first half averaged 443 million euros, a nice recovery from the historically low result of 372 million recorded in 2021. “The first half of the year is however still a little higher “, nuance Mr. Van Dessel.

In number of transactions, 2022 has the second best result so far, with 78,884 per day on average. That is around 10,000 more than in 2021.

AB InBev remains the first market capitalization of the Brussels market with 89 billion euros (-3.4%), followed by KBC (22 billion, -29%) and ArgenX which climbs on the podium thanks to a jump of 19% . Elia recorded the strongest increase (+25% to 9.9 billion).

The total amounts to 308 billion euros. That is a decrease of 50 billion in six months.

In the first half of the year, two arrivals were recorded (Mazaro and Deme) for four departures (FNG, Resilux, Acacia Pharma and Settlements).

In addition, Euronext Brussels recorded 32 capital raising operations companies listed on the secondary market. However, the amounts were low, since the total does not exceed 2.135 billion euros. In 2021, the same number of operations had generated more than 4.4 billion.

“We can see at European level that there is a real need for incentives for SMEsi.e. companies whose capitalization is less than one billion euros and which support the economy”, pleads the CEO of Euronext Brussels, who calls for a reduction in withholding taxes for these companies.

Young people, for example, are more attracted by big international values, observes Mr. Van Dessel. But they realize thatyou can’t win every time. We would like to attract them to companies closer to them, where their investment would be much more significant. There is also work to be done to boost interest in derivatives, which are declining despite being an opportunity to invest at lower risk.”

Another recommendation from Euronext: reduce taxation on employee share ownership to encourage employees to become part of their company. This would involve more workers while allowing them to possibly derive benefits in the event of a favorable economic situation, believes the CEO.

Short term, the latter is rather pessimistic. “There is cause for concern, the symptoms of war are reminiscent of what we have known in the past. It would take an abrupt event to stop it. Inflation helps some countries to repay the debt accumulated during the crisis sanitary, but for Belgium it is more complicated because of the indexation of wages. We cannot be optimistic, we are not yet in a phase where we see the end of this sequence.

The Bel 20 lost 14.5% in the first six months of 2022. Its little brother, the Bel Mid, which includes smaller stocks and therefore less sensitive to the macroeconomic situation, is doing a little better (- 13.8%). Volumes processed per day in the first half averaged 443 million euros, a nice recovery from the historically low result of 372 million recorded in 2021. “The first half of the year is however still a little higher “, nuance Mr. Van Dessel. In number of transactions, 2022 has so far achieved the second best historical result, with 78,884 per day on average. That is around 10,000 more than in 2021. AB InBev remains the first market capitalization of the Brussels market with 89 billion euros (-3.4%), followed by KBC (22 billion, -29%) and ArgenX which is climbing on the podium thanks to a jump of 19%. Elia recorded the strongest increase (+25% to 9.9 billion). The total amounts to 308 billion euros. That is a decrease of 50 billion in six months. In the first half of the year, two arrivals were recorded (Mazaro and Deme) for four departures (FNG, Resilux, Acacia Pharma and Settlements). In addition, Euronext Brussels recorded 32 capital raising operations for companies listed on the secondary market. However, the amounts were low, since the total does not exceed 2.135 billion euros. In 2021, the same number of operations had generated more than 4.4 billion. “We see at European level that there is a real need for incentives for SMEs, i.e. companies whose capitalization is less than one billion euros and which bring the economy to life”, pleads the CEO of Euronext Brussels. , which calls for a reduction in withholding taxes for these companies. Young people, for example, are more attracted by big international values, observes Mr. Van Dessel. “But they realize that you can’t win every time. We would like to attract them to companies closer to them, where their investment would be much more significant. There is also work to be done to strengthen the interest in derivatives, which are on the decline even though they represent an opportunity to invest at lower risk.” Another recommendation from Euronext: reduce taxation on employee share ownership to encourage employees to become part of their company. This would involve more workers while allowing them to possibly derive benefits in the event of a favorable economic situation, believes the CEO. In the short term, the latter is rather pessimistic. “There is cause for concern, the symptoms of war are reminiscent of what we have known in the past. It would take an abrupt event to stop it. Inflation helps some countries to repay the debt accumulated during the crisis sanitary, but for Belgium it is more complicated because of the indexation of wages. We cannot be optimistic, we are not yet in a phase where we see the end of this sequence.

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