This article appeared in the December 2009 Listed @ ASX newsletter.

Market performance for 2009

The benchmark S&P/ASX 200 index gained 26% this calendar year to date. If the return from dividends is included, a total return of 32% was achieved based on the S&P/ASX 200 accumulation index.

The performance of the benchmark was better than that of other major international markets as shown in the table comparing index performance below. Total market capitalisation of ASX listed companies rose by 36% to $1.45 trillion, compared to $1.07 trillion in December 2008. Trading activity has risen to new highs during 2009, with 500,000 trades being matched on ASX’s trading system, ITS® on a typical day.

Equity Markets Summary  
Capitalisation 31/12/08 ($b) 1,072
Buy-backs ($b) -2
Dividends ($b) -48
Capital raising incl. IPOs ($b) 96
Market Movement ($b) 332
Capitalisation 30/11/09 ($b) 1,450

Index Name CY 09 price performance
S&P/ASX 200 26%
S&P 500 21%
Nikkei 225 6%
FTSE 100 17%

Source: IRESS

Equity capital markets

In the 2009 calendar year to date, Australian companies raised a record $96 billion in initial and subsequent equity issues. Despite representing only 2-3% of global equity market value, Australia has the third most active capital market in the world by value of equity issuance. Equity capital market activity in the first half of the year was directed at recapitalising balance sheets and was largely confined to the large cap sector. In the second half of 2009, capital raising activity became more broadly spread to include the small to mid cap segment and became increasingly directed towards funding new projects and growth opportunities. 

IPO Market

After a period of subdued activity the IPO market re-opened in September 2009 with the successful listing of was the first major float since July 2008. In the second half of the year there have been 23 new company listings with a further 20 expected to list in December. There is also a strong pipeline of companies preparing to list in 2010 including private equity re-listings, divestments and numerous mineral exploration companies.  

Market Cycles and IPO Activity

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