A ‘phase one’ trade deal would bring certainty to the IPO market – Nasdaq exec.

on Nov 19, 2019
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  • Nasdaq Asia-Pacific chairman Robert McCooey is positive that a “phase one” deal between the US and China will bring to an end the uncertainty being experienced in the IPO markets
  • The phase one deal will however not address everything that the two states have been pushing for
  • The Chinese Ministry of Commerce confirmed that the two sides were indeed engaged in positive discussions

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A “phase one” deal between the US and China might
just be the much-needed elixir for the ailing Initial Public Offering (IPO)
markets. According to the chairman of Nasdaq Asia-Pacific Robert McCooey, a trade
deal between the two states should be able to eliminate the uncertainty that
has been experienced for the better part of the year.

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While several Chinese companies have expressed interest in trading
in the US market, the pending trade deal between two of the world’s largest economies
is still causing a stir among investors.

“Investors
are worried about China, they are worried about the ripple effects of the trade
war,
 McCooey explained during CNBC’s East Tech West conference
in the Nansha district of Guangzhou, China on Monday.

When
asked by CNBC’s Nancy Hungerford whether that goal would be attained, he simply
replied, “We will probably get close to 35 to 38 again this year.”

China and the US have been engaged in a series
of discussions
regarding matters that both sides hold dear and there is
growing hope that the “phase one” deal will offer better grounds for initiating
future negotiations. When contacted by CNBC, the Chinese Ministry confirmed that
there were indeed ongoing negotiations that would hopefully bring to an end the
trade war between the two states.

But Nasdaq’s McCooey told CNBC that the negotiations may not resolve
structural issues, some of which have been hindering the two sides from reaching
a deal.

“So therefore, some of the valuations haven’t really come in exactly where the companies would have wanted and I think they were waiting for there to be some more certainty,” McCooey said during the interview.

While
the “phase one” deal may not entirely cover every state’s concern, McCooey
remained positive that the agreement would have a positive impact on the IPO
market. “I do, because, at the end of the day, a lot of those things have
really nothing to do with how companies are going to list, the process of listing
in the U.S,” he said, adding: “Most of these companies have already done their
structures … to do an offshore listing.”

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