Emerging Markets: Trading In Depositary Receipts Sets Record

Dr News

 

By GP

 

A record of more than 72 billion American and global depositary receipts changed hands in the first six months of 2009, an increase of 14% from the same period a year earlier, according to The Bank of New York Mellon. The total number of DR programs available for trading grew by 44% in the same period to 3,096, mainly due to changes in US regulations that made it easier to establish over-the-counter DR programs.

 

A total of 194 new sponsored and unsponsored DR programs for issuers from 32 countries were established in the first six months of this year, the bank said.

 

The US-listed market remained the largest DR trading market by far in the first half. The New York Stock Exchange and Nasdaq accounted for 90% of all DR trading worldwide. The most actively traded DR issues on the major US stock exchanges included Brazil-based oil and gas company Petrobras and Brazil-based mining company Vale, as well as Taiwan Semiconductor Manufacturing, Finland-based cell phone maker Nokia and Mexico-based cement producer Cemex.

 

Russia-based companies were among the most actively traded DRs on the International Order Book (IOB), including Gazprom, Lukoil and Norilsk Nickel. The IOB is the main trading platform for both the London and Luxembourg stock exchanges.

 

The amount of capital raised via DRs in the first half was significantly lower than in the same period a year earlier, due to global economic and market conditions. Thirteen initial and follow-on DR offerings raised nearly $5 billion in the first half of 2009. China led in the number of issues with five, followed by India with three.

 

 

 

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