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The unicorns have made the Tel Aviv Stock Exchange the most successful in the world

The stock market symbolizes increases in bulls and declines in bears, but it is precisely an imaginary animal that has had the greatest impact on this year's financial achievement: the Israeli unicorn, which usually raises money overseas, has attracted investors' attention to the Tel Aviv 35 index.

Roast Greenberg

12/01/2022

Wednesday, 12 January 2022, 14:29 Updated: Thursday, 13 January 2022, 10:26

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Precisely against the background of two years of global crisis, the local stock market woke up to a rosy dream: the huge issues of Israeli high-tech companies attracted the attention of foreign investors to the trading arena in Tel Aviv, and the result: the "Tel Aviv 35" index ranked first in the world

. Capital began to circulate and analysts and investors began to scatter the chips of options on the stock exchanges that they believe will achieve the best return in 2022. The Israeli slot continues to accumulate cash

. In the

Tel Aviv 35 index.

The ranking made 2021 one of the most successful years of the Israel Stock Exchange. Most of the achievement can be attributed to the attention of foreign investors to the local stock exchange, which was achieved against the background of replicas of Israeli high-tech companies abroad, along with Israel's initials in the corona vaccine campaign, which returned Israel's economy to relative routine.

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John Mayer, Chief Investment Officer at US Global Global ETF (Photo: GLOBAL X)

John Mayer, Chief Investment Officer at American ETF Global X

, explains: "The Tel Aviv Stock Exchange has experienced 97 new issues, most of them in the high-tech field, with raising NIS 26 billion.

It seems that the strong year of the Israeli stock market reflects The latest strength of the Israeli venture capital ecosystem. Foreign investors see the Israeli economy as a leader in innovation and have invested significant amounts of capital in both public and private transactions, and foreign investors have purchased NIS 9 billion from shares listed on the Tel Aviv Stock Exchange

. As global economies sought to strike a balance between reopening economic activity and managing the ongoing epidemic, and as inflation rose, there was a severe shortage of goods, and two new versions of the virus emerged - Delta and Omicron.

But it is worth examining the capital markets in the world, despite the seemingly negative background, as they have recorded the third consecutive year of double-digit returns.

For example, the S&P 500 reached 70 new highs in 2021 and recorded an impressive return of 28.68% that year (see the table of performance of the major stock indices on the various stock exchanges in the world).

"The weak bond markets, and the return of investors from the growth sectors to real estate investments are the two main reasons for a broader recovery in the markets that led to a strong end of 2021."

Leading stock indices in world brussels.

Tel Aviv in first place (Photo: Walla !, no)

The Israeli stock exchange is not the only one whose main index has led to a high return, and immediately behind it is the French stock exchange, where the 40 largest companies traded yielded 31.88% for 2021, and third came the Swedish stock exchange, with a return of 31.25%.

This is in contrast to the American technology companies index NASDAQ, which admittedly led 2020 - by a gap of all stock exchanges in the world - with a return of 45.05%, but in 2021 yielded 22.21%, which is 9.74% lower than the Israeli central dimension, 9.67 % Of the yield of the French index, and 9.04% of the Swedish central index, for the same year

. The 2021 performance marks the largest percentage increase in a single year for the CAC 40 since 1999.

In Sweden, 30 OMX performance was mainly driven by a strong IPO market in 2021, during which 122 IPOs were made, leading to a raise of approximately $ 18 billion (see IPO table on the Swedish Stock Exchange).

In addition, Sweden has regulation that is defined as positive and encourages membership, and a strong economy.

"All of these make the Scandinavian country's stock market an attractive location for various startups as part of making them public."

The competitor from Sweden.

There, too, they will positively remember 2021 (Photo: Walla !, no)

Below the red line

But not everything is rosy in the global capital markets, and there were also 3 stock exchanges whose main indices yielded a negative return; Hong Kong's HANG SANG index bottomed the chart with a negative return of 11.84%, above which is the Brazilian IBOV index which yielded 11.81% - a negative return, and above them is a third from the bottom of the Chinese CSI 300 index, with a negative return of 3.51%.

"China has become one of the second-largest performance markets in 2020," Meyer says, "one of the worst players in 2021. The drastic change in the index's performance was largely due to investor panic, which saw the Chinese government quickly implement stricter regulatory policies against some major sectors, including gaming, education and the Internet. In

addition, the fallout from the Evergrande debt crisis (a Chinese asset giant carrying about $ 300 billion) was another factor that weighed on investor sentiment.Some investors still see China as one of the most opportunistic investments for 2022.

For example, Mary Erdoes, CEO of JP Morgan Asset & Wealth Management (one of the largest banks in the world, which manages about $ 3.4 trillion), announced a few months ago that 'China went on sale', and analysts at the bank estimate that the MSCI China index will rise 40% in the coming

year.Blackrook

(an American investment fund that manages about $ 6.7 trillion), and the banks UBS and HSBC have raised their forecast for Chinese stocks to be overweight.

Only 6.9 times the profits next year, amid local fears of a change in the country's fiscal policy, which has led the country's local stock market.

The Brazilian central bank is aggressively raising interest rates to fight high, historically high levels of inflation. Significantly throughout 2021.

And as for the reasons why the Hang Seng Index 'won' to reach the last place in the table of key stock market performance indices disappeared for 2021 - these are the same reasons why the Chinese CSI 300 index performed poorly.

Chinese regulation in the technology, internet, gaming and education sectors has hit Hong Kong hard as many of the leading companies in each of these areas are registered in it.

Analysts' forecasts for 2022. Will Tel Aviv retain its place (Photo: Walla !, no)

You'll see how good it will be next year

Looking ahead, estimates are that the capital markets are expected to be more selective in 2022, with a greater emphasis on what is defined as fundamentals, ie: company performance. "

Where does this place the Israeli stock market in 2022? It is not known. The local one, which joins MSCI's European benchmark indices if entry into the global indices is completed, will still flow many billions to Tel Aviv

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