International IPO markets have largely underperformed the US in the past two years, but the Renaissance International IPO Index (IPOXUS) is showing signs of a recovery. IPOXUS, which is designed to hold the largest, most liquid newly-listed non-US IPOs, is up +5% year to date.
The International IPO Index reached a nine-month high on Monday. At Wednesday's close, it was +11% above its April low. IPOXUS is still underperforming the MSCI ACWI ex-US Index (+8% YTD), but it has been steadily closing the gap since the end of January.
The biggest tailwinds have come from the Asia-Pacific region, which has started to rebound after struggling in 2023. Several of the International IPO Index’s Hong Kong-listed constituents are among the best recent performers, led by AI tech developer SenseTime, which has soared +147% over the past month. Other names from the region that have delivered strong trading include EV maker Leapmotor (Hong Kong), geothermal power plant operator Barito Renewables Energy (Indonesia), snack food producer Monde Nissin (Philippines), and chipmaker Socionext (Japan).
Europe has also produced some recent winners as the region's markets have started to reopen. Top performers from Europe are led by cybersecurity firm Darktrace (UK) and web hosting services provider Ionos Group (Germany). Others include online food delivery company Deliveroo (UK), renewable energy play Acciona Global Renewables (Spain), and discount retail chain Pepco Group (Poland).
The International IPO Index is an important benchmark for IPO activity overseas, and the recent rally is a positive sign. If foreign issuers continue to deliver solid trading, international markets should continue to recover and reopen through the remainder of 2024.
Note: The Renaissance International IPO Index is the underlying index for the Renaissance International IPO ETF (NYSE: IPOS).
