Underwriting activity in the domestic markets fell back in the first quarter 2002 after rebounding at the end of last year. Equity trading volumes were up slightly for the second straight quarter, yet well off the peaks experienced in 2000 based on the latest quarterly report issued today by the Investment Dealers Association of Canada entitled Review of Equity New Issues and Trading.

Trading activity inched up 8%from the previous quarter to $177 billion, but compared to the first quarter of 2001 however, volumes were down 17%. Events over the past year have depressed investor confidence, preventing a strong turnaround in market activity.

Common equity financings for the quarter totalled $1.9 billion, down 63% from the previous quarter and returning to the general downward trend experienced over the past two years. The lack of any large new public offerings was the driving factor behind the decline as only one issue topped $150 million.

The IPO markets continued to struggle as first quarter 2002 totals tallied $133 million, the second lowest quarterly number in over three years.

The only bright spot was the trust unit market that continued to swell in the January – March period. Over $2 billion in new money was raised through trust units which serve as another option for investors unsatisfied with the returns of fixed income products or the sagging equity markets.