After a string of IPO flops, European technology investors received some good news this morning when online broker Comdirect soared to E38 on its Neuer Markt debut, up E7 from its issue price.
The flotation of Germany's leading Internet brokerage by owner Commerzbank was billed as a test for Europe's hi tech sector, which has been punished in recent weeks by investors.
Comdirect's strong debute performance shows European investors may be following the lead of American investors. Following news last week that US interest rates may have peaked, investors piled back into technology stocks and fuelled Nasdaq's best week on record.
However, because the Comdirect issue was modestly priced at E31 and was able to generate retail demand from Commerzbank's large customer base, investors will be reluctant to draw conclusions about a general recovery in the sector.
The issue, which raises E790m on 25.5m shares, values Comdirect at E4.3bn. The online broker says it had 510,000 customers in May or 29% of the market. But analysts warn Comdirect faces stiff competition from ConSors and Direkt Analage Bank and other new entrants.