The domestic capital market last year did not only witness an increase in stock values but also a slight recovery in liquidity, a problem that has been pressing the Croatian stock exchange for many years, since the major crisis of 2008/2009. According to the monthly report, the Zagreb Stock Exchange concluded last year with nearly 372 million euros in total turnover, which is five percent less than in 2022.
The decline is primarily the result of significantly lower block trading in stocks, which reached 138.5 million euros in 2022, and only 37.6 million euros last year. However, in the most important trading, which is stock trading, a positive shift was recorded last year. Within the order book, stock trading amounted to 267.2 million euros, which is a significant 17.5 percent more than the previous year. Additionally, bond trading doubled, from 16.6 million euros in 2022 to 39.1 million euros last year.
Excellent Result in the End
Ivana Gažić, CEO of the Zagreb Stock Exchange, emphasizes that considering last year’s index growth, she would have been happier if turnover had increased more than 18 percent. – However, the first half of last year was quite calm in terms of liquidity, so we are ultimately satisfied with the achieved turnover – says the head of the domestic stock exchange.
When asked how much the listing of the national bond influenced the increase in bond trading, Gažić states that most bond trading occurs in over-the-counter (OTC) trading, and turnover within the order book is usually modest. – It can be said that the listing of the national bond had a certain impact on the increase in bond trading, but that impact is not significant – assesses Gažić.
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Last year also brought significantly better trading in investment funds whose shares are traded on the stock exchange (ETFs). These securities were traded for 16 million euros, 58 percent more than in 2022. – ETFs were a novelty in our market upon listing, and they are particularly suitable for small investors as they allow exposure to a basket of securities without high costs. We now have four listed ETFs, so I expect this type of trading to continue to increase – notes the CEO of the Zagreb Stock Exchange.
On a monthly basis, December brought certain corrections compared to November, with stock trading within the order book amounting to 23 million euros, which was 1.6 percent less than the previous month, but ultimately, thanks to block trading in bonds and increased trading in ETFs (+19 percent), total turnover of 45 million euros increased by a significant ten percent, the report states.
Foundation for Optimism
In line with the increase in stock prices indicated by the CROBEX index of 25 percent, the total stock market value of all stocks also increased last year. The market capitalization of stocks in December was better by 4.1 percent, bonds by almost two percent, and ETFs by as much as 25 percent. Thus, at the end of last year, the total market capitalization of the Zagreb Stock Exchange amounted to 40.8 billion euros, which is 19 percent more than at the end of 2022. Regarding all listed stocks, their value reached 22.9 billion euros or 27.2 percent more than the previous year.
The domestic capital market has been under the influence of the general economic growth for some time, which provides a foundation for optimism this year. Ivana Gažić says she is optimistic about 2024 as she expects the continuation of good macroeconomic indicators. – If there are no surprises, I believe the stock exchange will continue to follow good economic trends – concluded the head of the domestic stock exchange.
