Two years after the launch of Swiss stock exchange's new market, the euphoria that greeted its opening has given way to a mood of depression.
The only consolation for the head of the market, Robert Wyss, is that markets with technology stocks have suffered the same fate all over the world.
"We have seen that the markets have dropped significantly since March last year, so Switzerland is not a unique case," Wyss told swissinfo.
"We have seen it all over the world in these growth markets. But I must admit, we are quite disappointed," he added.
In Zurich, the stock value of the 16 companies in the SWX New Market has fallen from a high of SFr15.7 billion ($9.09 billion) last September last 2000 to just over SFr6 billion. The index of the New Market has fallen from 2,400 points in March last year to 661.79 at the end of last week.
Far cry from a year ago
The situation is a far cry from the first anniversary of the New Market last year when the SWX authorities were "very pleased" with the way it had developed.
Targets had been more than met, with 14 new listings in the first 12 months, including five non-Swiss issuers.
To add icing to the first birthday cake, the market's index, the SNMI, had outstripped all other comparable European indices by a factor of almost two.
The New Market of the stock exchange was designed for rapidly growing companies from both Switzerland and abroad. The idea was to provide the companies listed with a simplified means of entry to the international Swiss capital market and offer investors the opportunity to benefit from the above-average growth potential of such companies.
Since March last year, the markets have made it clear that there is not much confidence in the growth potential. Poor company financial figures and outlooks have also turned would-be investors elsewhere.
However, Wyss believes that the position of the New Market in Switzerland will not deteriorate further.
"I don't think the situation will get worse. It's more that the market has to have less volatility. We see that the market reacts very nervously about earnings revisions, so I think that has to improve and the market will also pick up," he told swissinfo.
No further IPOs in 2001
Wyss does not believe that there will be any new initial public offerings this year, with would-be entrants afraid of a flop. With 16 players listed, the New Market is still a long way from achieving the critical mass of 50 companies.
However, Wyss says that the New Market will continue to try to attract companies in cutting-edge sectors.
"We do not have to change our strategy. We always focussed on companies from the life sciences sector, that means bio tech and med tech companies, as well as information technology firms," he said.
"We see that the next companies joining our market will come from these sectors. They're not only from Switzerland but from foreign countries too and that's very important," he added.
Wyss explained that three Israeli companies are in the New Market, mainly because Israel has a weak financial market and the companies involved had to look farther afield.
"They saw that their IPOs here were quite successful and we are now in contact with some Canadian, United States and German companies. They want to come to our market because we have a high degree of know-how, particularly in the life sciences sector," he added.
However, the mood of all the players involved - companies, banks and investors - is going to have to be much more upbeat before the New Market picks up again and attracts more listings.
by Robert Brookes