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Prospects for IPOs continuously improving

Deutsche Börse’s IPO indicator for quarter two 2010 shows that sentiment concerning initial public offerings on the German equities market is increasingly positive.

Falling volatility on equity markets combined with increasing share prices indicates heightened issuing activity.

Parallel to this, market participants’ expectations concerning IPOs have continued to improve.

Market participant’s perception that the difference between the issuing price and first listing price, the underpricing, recently decreased, is having a dampening effect. All in all, the environment for IPOs appears to be steadily improving.

The IPO indicator, which is published each quarter, is a barometer for companies seeking capital that aim to go public. The indicator is compiled from surveys of market participants and calculations by the Technical University in Munich using Deutsche Börse trading data.

“The successful first IPO quarter shows that equity capital is again available on the exchange. The indicators now available reliably show that the trend will continue in the coming months and that the issuing backlog will ease,” says Frank Gerstenschläger, member of the executive board of Deutsche Börse.

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