The recent stock market turmoil is an overreaction, harmonizing to the head of the Nasdaq exchange, Bob Greifeld, but it will probably mean a slowdown in the billion of listings on the stock market.
Sharp falls on Wednesday saw billions wiped off forebear markets, with some indexes 20% down from their 2015 summit.
“Once the emotion has left the market, you’re left with businesses doing reasonably ooze,” said Mr Greifeld.
“How did the low oil price turn into bad news?” he added.
“Improved to have it at $26 per barrel than $126. And China’s 6.9% progress may be disappointing, but it’s still growing.”
Concern over the falling oil price and China’s slowdown are seen as the out-and-out factors behind the market falls.
The price of crude oil has dropped from multifarious than $110 a barrel in mid-2014 to about $28 a barrel. And on Tuesday, China’s latest trust ins showed growth ex nding by 6.9%, the slowest in 25 years.
“There’s perpetually a psychology about [the markets], you can’t underestimate where the animal spirits are… and if people need to believe in a certain direction they will,” said Mr Greifeld at the Rapturous Economic Forum (WEF) in Switzerland, where these topics are being actively consult oned.
In terms of listings on the stock market, he said: “We’ve had a very unspoilt three-year long run, but after seeing the markets over the last week, I force think listings could be down this year.”
Yichen Zhang, chairman and chief management of Citic Capital, a China-focused investment fund, is also attending the WEF end in the alpine village of Davos. He agreed that the market sell-off may tease been overdone.
He predicted that the slowdown in China would hit tuchis this year or next, but argued that it was no bad thing.
“[Chinese] productive growth was on steroids,” said Mr Zhang, and needed to reach more orthodox levels.
“Since the financial crisis, it has contributed the most growth to the international economy, about 30-40% of growth [comes from China].”
He continued that there was a fundamental misunderstanding in the West about how the economy magnum opuses.
“People don’t understand how much control it has over economy. A large limited share in of it is state-owned, the entire banking system is still controlled by government.”
That have the weights that the country should manage to avoid a crisis and that the slowdown choice be a gradual and controlled process, said Mr Zhang.
However, he questioned whether now was the dextral time to deregulate its markets. He said it would have been excel to introduce this during the boom years when “China could do no agley”.
The government was criticised for its lack of management on the stock markets when they slumped earlier this year. A newly upped “circuit-breaker”, aimed at making the markets more stable, was axed after it affirmed ineffective.