By Freya Berry and Elzio Barreto
LONDON/HONG KONG, June 30 (Reuters) - Global equity capitalmarkets activity has sunk to a four-year low in 2016 accordingto quarterly ThomsonReuters data, although bankers and investorssaid that while Brexit could dent volumes it would not sink themarket.
The value of worldwide equity capital markets (ECM) activityhas almost halved so far this year compared with the same periodin 2015 as geopolitical uncertainty, the prospect of a U.S. raterise and global growth concerns bite.
Levels were down 46.5 percent at $280.8 billion, accordingto quarterly data from Thomson Reuters.
Money raised by European initial public offerings (IPOs)sank 56 percent to $16.2 billion, as the shadow of Brexitdarkened prospects for deals on the London Stock Exchange, traditionally Europe's busiest. London IPOs raisedalmost 60 percent less than the same period in 2015.
But amid the turmoil some saw opportunities. Investorsprivately told Reuters that they hoped a short-term depressionin UK stock prices would help them snap up company stakes on thecheap.
And bankers said they were revisiting client lists to workout who might need equity capital in the months and years ahead.
"What might clients need if volatility continues? That's thequestion," said Achintya Mangla, head of equity capital markets(ECM) for EMEA at JPMorgan.
"It's back to basics. We're making sure we know what clientsneed now and for the coming weeks, and are advising them on adaily basis about the right course of action."
JPMorgan rose to pole position in the global ECMleague tables, followed by Morgan Stanley and GoldmanSachs.
Bankers said they remained optimistic that the market wouldbe resilient enough for listings following the traditionallyquiet summer period, albeit perhaps at lower volumes andpricing.
"The IPO market is going to be open, but maybe not quite asactive as before," said Craig Coben, co-head of global ECM atBofA Merrill Lynch.
"Investors will subject IPOs to strict scrutiny beforebuying, but I don't think there will be a buyers' strike."
BREXIT JITTERS
Stock market listings have had a reasonably successfulquarter. Major European companies including Danish utility DONGEnergy - the biggest IPO of the year so far - andPhilips Lighting both found favourable receptionson their day of listing.
That said, some admitted that they were having to soothe theconcerns of jittery teams and clients.
Stephen Lloyd, partner at law firm Allen & Overy, said some1,750 clients worldwide joined a call examining the implicationsof Brexit after the result on Friday.
Others questioned whether the LSE, currently battling to getregulatory clearance for a merger with Germany's Deutsche Boerse, would be able to maintain its European dominance ina post-Brexit world.
"In the short term people don't like to come to marketduring periods of any volatility or uncertainty," BrianSchwieger, head of equities at the LSE, told Reuters on thesidelines of a conference in Hong Kong on Wednesday.
"It's critical that we get that agreement in terms of whatthe relationship is going to look like between the UK and EUright."
Martin Steinbach, head of IPO and listing services forEurope, the Middle East, India and Africa, expected a"stop-and-start" market with clients choosing listing locationscarefully.
"The strategic question on where to list is becoming veryimportant," he said. "Stock exchanges have to ask themselves, ina globalised market, what is their USP?"
ASIAN WEAKNESS
Share offerings in Asia Pacific ex-Japan sank nearly 60percent in the first half of 2016. ECM proceeds tumbled to $66.6billion, according to preliminary Thomson Reuters data throughJune 27. That was the weakest activity since the first half of2008.
"The stars have absolutely aligned in an odd way againstbasic global or international issuance," said Aaron Arth, headof ECM for Asia ex-Japan at Goldman Sachs.
"Investors have not been active in the market and that'srepresentative of the performance you've seen."
Despite the gloomy first half and expected volatility in thenext few months, some large offerings from companies in thefinancial services sector, including banks and brokerages shouldboost activity in the region, analysts and bankers said.
And a cautious optimism was seen across the market.
"After summer the traditional IPO season from September onwill continue," said Bidhi Bhoma, director of corporate financeat Shore Capital in London.
"I fundamentally don't believe that short term we'll behugely affected." (Addtional reporting by Michelle Price in Hong Kong; Editing byGreg Mahlich)
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