The business year 2015 could to be ending with a year-end-rally. This development has started earlier than expected. After the quick sale of nearly all sectors of the stock exchange from the middle of August, due to growing concerns about Chinese economic growth and a possible raise in interest by the US-Fed, the investors focused on attractive possibilities for yields again. Other asset categories like fixed income, properties or commodities currently are an inferior alternative to equities. Potentials for yields of fixed income and properties are at depressed levels and markets for commodities have been continuing their downwards trends since 2011.

Especially the development of values for properties and commodities is seen in the prices of stocks. The increase for property stocks has been going in a seamless way since spring 2009. The EPRA/NAREIT Developed Europe Index has tripled since then. The discounts to their Net-Asset-Values have decreased respectively have turned into premiums. So investors turn to Austrian property stocks. Particularly for foreign Buyers and Property companies Austria is a special case. Discounts for corporations like Immofinanz and Conwert are hardly to find with German competitors although there are overlaps to find in their portfolios. It is clearly to see that Austrian companies are close to Eastern Europe and Russia.

Depressed prices for energy commodities and power are caused by an oversupply of energy production. Oil, gas, coal and power have been trending downwards for a while. In particular for gas and coal no changing trends can be found as demand, especially compared to supply, is developing in a restrained way. Again, China plays a role. China´s economy growth decreased in recent years. In the meantime 6.5% have become targeted growth rates. Additionally energy will be used more efficiently. In the oil sector prices seem to stabilize. Enormous productions cuts by non-state-owned oil companies should lead to a decrease of supply. Even “new” competitors like Iran and spare capacities with OPEC are not expected to compensate.

Insofar equities remain one of the most attractive asset classes, also because companies can benefit of these changes in the pricing of bonds, properties and commodities.

Bernhard Ruttenstorfer
Senior Fund Manager
23 November 2015


Wiener Börse AG would explicitly like to point out that the data and calculations given in this report are historic values, which do not permit any conclusions as regards future developments or value stability. Price fluctuations and loss of capital are possible in securities trading. The contribution is the personal opinion of the analyst and does not constitute a financial analysis or a recommendation for investment by the exchange operating company, Wiener Börse AG.