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On Thursday, the Oslo Stock Exchange opens more than one percent for the second consecutive day. Stockbroker Pexip is trading at around NOK 90 in the first few minutes, after a share price of NOK 63.
– What bothers the Oslo Stock Exchange during the day is the strong exposure to the cyclical industry, oil and oil service.
This is according to analyst Karl Oscar Strøm of Pareto Securities.
From the bottom in mid-to-late March, the main index on the Oslo Stock Exchange has gained nearly 20 percent. On Thursday, the stock market closed just over 1.5 percent at a price of 758.14.
But it is still a long way from the levels the main index was in before the crown crisis. Since the stock market crashed in March, the main index has closed three days in a row only once. It was at the end of the same month.
The Pareto power predicted in April that what we were facing was a “turnaround,” that is, one had the initial recession, then a correction, and then another recession.
Today reiterates that these are classic indicators in a so-called bear market, that is, a market where the decline has been present over time.
– The short answer to whether we are facing a new recession is yes. There is classic market dynamics in bear markets in which there is a sour period of falling peaks and bottoms. It’s easy to predict the first two things that happen, with the initial shock in the economy and then a correction. Third, it’s hard to say how big and how long the recession will last, Strøm admits.
First day of video technology trading
Video conferencing company Pexip has its first day of trading on the stock exchange on Thursday. Strøm calls the IPO a bright spot, noting that interest in the stock has been huge in the time before the IPO.
As is well known, the shares were oversubscribed 20 times by private and institutional before the first day of trading on the stock exchange. The share price was NOK 63 and traded above NOK 90 in the minutes after opening. With that, the market value rose almost NOK 3 billion in the IPO.
This means that in just a few minutes the company has increased its market value by almost NOK 3 billion. Before the IPO, the company was worth just over NOK 6 billion.
– It’s been a long time since we had something like this, and you remember what Tandberg’s actions were like in his time. Compared to Zoom, it’s exciting with Pexip because it can connect to all systems, Strøm says.
Don’t believe in the V-shaped rise
The analyst believes that it takes a lot to see new peaks first.
– I am not “pessimistic”, but this is a merchant market with great opportunities both ways. But the sun on my face and the wind on my sails I think it will be a while until we see again, Strøm says.
He also notes that even though the stock market has rebounded after the fund, the case is not the same in the credit market. Power does not believe in a V-shaped rally where the market recovers quickly, and warns that it will take time before it returns to normal.
– You have company after company that is now worsening your finances as a result of the crown eruption, which has to make adjustments that may involve taking on more debt or reducing costs. It is also seen in the quarterly report that companies are pulling or exiting to orient themselves on future prospects, because it is highly uncertain, Strøm says.
Fear of a new trade war.
On Wall Street, the mood so far this week has deteriorated considerably after a cautious start. On Monday, the three benchmarks, the Nasdaq, the S&P 500 and the Dow Jones, closed slightly, but in recent days they have pointed sharply at closing time.
Wednesday was another day of decline, after the US governor. USA Jerome Powell drew a grim picture of the American economy exposed to “a level of pain that is difficult to understand in words.”
Then President Donald Trump followed up with a series of Twitter messages addressing the turmoil in relations with China.
The message does little to facilitate the relationship between the two countries. The prospect of a new trade war between them has burdened the markets lately, and threats of widespread sanctions against China by Trump’s allied senator Lindsay Graham contributed to the crash on Wall Street on Tuesday.(Terms)Copyright Dagens Næringsliv AS and / or our suppliers. We want you to share our cases using a link, which links directly to our pages. Copying or any other use of all or part of the content may only be made with written permission or as permitted by law. For more terms see here.
