More Evidence the Animal Spirits Are Back... Caution!
We are beginning to see sightings of animal spirits in most all quarters of the financial markets. This week promises a surge in IPOs:
IPO Market Regains Momentum, WSJ, September 21, 2009
Guess which US-market IPOs have been most successful so far this year? This is from the Journal's excellent Heard on the Street column:
"Need more evidence that the red economy still is white hot? Consider this: Four of the top-performing U.S. initial public offerings this year were from China-based firms.
Shares in Changyou.com, an online-game maker, have doubled since floating in early April. Newcomer Recon Technology, which sells software to mining companies, has surged almost 60% since late July. Duoyuan Global Water, which makes water-treatment equipment, is up almost 50% since its June float. Shares of Lihua International, a wire maker, have climbed almost a third since Sept. 9. Next up? Shanda Games, an online-gaming firm that expects to raise at least $650 million this week.
Almost a third of new listings on the Nasdaq this year have come from China, as did four of 15 IPOs on the New York Stock Exchange."
I warned investors regarding this anomaly at the end of July -- it appears the risks remain unchanged.