The Athens Stock Exchange (ATHEX) secured the top spot of all bourses around the world in 2023 in terms of dollar returns and third place in terms of local currency yields, boasting a significant 39% gain, according to the Deutsche Bank’s annual review.
This achievement marked the culmination of a robust financial year for the Greek market, which managed to carve a prominent place on the world stage, despite a slowdown in performance during the last five months, the German multinational notes, adding that ATHEX presents investors with numerous challenges and opportunities.
The Athens bourse emerged as a mega-catalyst and is eagerly anticipated by foreign investors in 2024, underlining its newly found role in the international investment landscape.
Geopolitical events remained a focal point throughout the year, particularly after the Hamas attack on Israel in October. However, from late October onwards, there was a remarkable rally in various asset categories as the decline in inflation prompted investors to increasingly embrace the scenario of a soft landing. The rally gained further momentum in December, especially after the Federal Reserve signaled interest rate cuts totaling 75 basis points for 2024, as explained by Deutsche Bank.
Despite the numerous fluctuations experienced throughout the year, most asset classes delivered robust performances in 2023. Notably, the S&P 500 recorded a substantial increase of 26.3% in terms of total returns, supported by a remarkable 107% gain from the Magnificent 7, high-cap technology stocks. Bonds also returned to positive territory following two years of losses, thanks to their delayed recovery in the final two months of the year.
Central to these positive developments was the delayed resurgence of bonds, signaling a turnaround for an asset class that had faced challenges in the preceding years. Additionally, with central banks maintaining an optimistic outlook for a significant part of the year, risk-free interest rates in 2023 reached their highest levels in quite some time.
These positive trends contributed to the overall success of the Greek stock market, positioning it favorably on the global stage despite periodic challenges and fluctuations. As the year unfolded, various geopolitical events and market dynamics shaped the financial landscape, creating both opportunities and hurdles for investors navigating the ever-changing terrain of the global markets.