The extensive media focus on Iceland’s economy and financial enterprises recently has left a strong imprint on the equity market. In many respects this discussion has been quite ruthless, spotlighting negative factors while ignoring more positive aspects. The result has been agitation and volatility on the equity market, reflected in the fact that the ICEX-15 index was around 20% lower at the end of Q1 than at its highest point prior to the beginning of this debate. Despite the decrease, however, the ICEX-15 is still 6.5% higher at the end of Q1 than at year-end 2005, and its lowest level during the quarter was similar to the year-end level. It is definitely a cause for concern that a sudden change in the tone of the international media – apparently without much cause – can cause so much turmoil here in Iceland. And it suggests that ICEX should look more closely at how they communicate information to others on the Icelandic economy and financial issues.
Click here to download ICEX's first quarter 2006 statistics.
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