Dutch weather the euro storm, suggest Markit figures
Dutch companies have avoided the worse of the financial crisis and avoided the attention of short sellers, according to data from Markit.
Markit has looked at figures ahead of the country’s general election next week.
The long-short ratio, which measures how many times longs outnumber shorts, currently stands at 11.5x, about twice levels seen in May this year – suggesting increasingly positive investor sentiment, said Markit.
The estimated value of stock on loan has fallen 30% since then to $7.5bn.
The proportion of shares on loan is a lowly 2.3% across AEX and AMX constituents, compared with 2.4% for the broader Stoxx 600 index.
There has also been decreasing demand to borrow Dutch government bonds. The long-short ratio here is 4.3x, up by a third since March as institutional investors have increased their holdings of the ‘AAA’ rated bonds.
There is also an increasingly positive outlook on dividends from Dutch companies. Markit data suggests 44% of Dutch companies paying dividends expect to increase their payments to shareholders.
Expectations of rising dividends are highest in the food and beverage sector, and companies such as animal feed provider Nutreco, Unilever and Heineken. Dividends will even increase in the financial sector, where insurer Aegon is to resume interim payments next year.
Some sectors are less bullish. Logistics services companies TNT and Post NL have suspended interim payments, while telco KPN is looking to reduce its dividend to preserve cash.