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TUESDAY 12th Sep

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Excitement grows over Arm’s IPO whilst Europe looks gloomy

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Arm’s oversubscribed IPO

The much awaited IPO of Arm, the chip company currently owned by Softbank, is so heavily oversubscribed that reports suggest they will close the orders by mid afternoon on Tuesday 12th September. Their goal is to raise around $5 billion by listing on the stock exchange in what might be the biggest IPO of 2023. Some fear that the hype could lead retail investors (in other words, not banks, investment funds or corporations) to be stung by a potential fall in value post initial listing, as has happened with other IPOs recently. Many hope, however, that Arm will be the first of many to buck that trend. 

The weakening Euro

The Euro has seen a gradual decline in value when compared to other global currencies, notably the US dollar. Economic data released in Europe over the last few weeks has been weak, especially in Germany which is usually the power house of economic growth in the region. Meanwhile, figures are surprisingly strong for the US, which has only added to a currency rally for the US dollar. This may add further pressure to interest rate decisions to come in the near future for the ECB (European Central Bank).

Spanish inflation back on the up 

Spain was the first country in the European region to see their inflation fall back below the desired 2% mark just two months ago. However, figures released today show a climbing inflation rate, coming in at 2.6%. This presents a frustrating outcome for the nation in political limbo, as fuel and some food prices drove inflation up over the summer months. It may also further indicate to the ECB that the inflation battle is far from over and further interest rate hikes are required. 

Sources: Bloomberg, Reuters, Financial Times

Zoe Burt