FRC says market capitalization up 12.8 %

Market capitalization of the securities market has surged 12.8 percent in the third quarter of this year compared to the same period in 2017, reaching 2.35 trillion MNT, reported the Financial Regulatory Commission (FRC).

In terms of capitalization, there is not much parity on the Mongolian Stock Exchange (MSE). Of the 200 publicly listed companies, 30 of them account for more than 91.9 percent of total market capitalization. As a result, the 12.8 percent increase was mainly due to increases in the Tier-1 or companies in the Top 20 index of MSE. The Top 20 Index saw an increase of 10 percent in the third quarter compared to the same period in 2017.

Large companies such as Gobi JSC saw a 90 percent increase in its stock while companies like Suu JSC saw a 30 percent increase in its stock prices. EuroAsia Capital Holding JSC saw an eightfold increase in stock prices.

Issuance of government bonds on MSE halted in the fourth quarter of 2017. In 2017, government bonds made up around 80 percent of total trading. Since the government has made the decision not to issue bonds on MSE, trading volume has fallen.

Stock trading however has quadrupled in the third quarter of 2018 compared to last year. Primary market trading in the form of IPOs have increased with several companies launching offerings. Looking at the numbers, MSE conducted 28.3 billion MNT in trading in the third quarter. This is a 86 percent decrease compared to 2017, mainly due to the halt of government bond issuances.

The first private stock exchange, the Mongolian Securities Exchange (MSX) saw trading of 279.6 million MNT in the first three quarters of 2018. The MSX acquired trading and clearing licenses from the FRC in July 2015.