Austria’s stock market has been Europe’s star performer so far this year. The Austrian Traded Index (ATX) is up 20%. Yet all is not well in the Alpine country.
A snap election called this month for October 15 offers another chance for Europe’s right-wing populist politicians to take power, reported The Financial Times.
Austria’s Freedom party will play on the country’s economic underperformance relative to its larger neighbour, as well as Europe’s migration crisis.
The ATX’s surge is partly stock specific, the result of improvements at Erste and Raiffeisen banks and the OMV energy group, which make up more than 40% of the index. Nevertheless, Austria illustrates increasing confidence in continental European economies — and rapidly diminishing fears about political risks in the wake of France’s presidential election.
“The risks in terms of populism are for now… most probably higher in the US than Europe,” says Fritz Mostböck, head of research at Erste.
The October 15 election will be a three-way contest. The Social Democrats and the centre-right People’s party currently govern as a “grand coalition”. Until recently, voter disenchantment with their performance was spurring the third contender — the far-right populist Freedom party, which was leading in opinion polls, reported The Financial Times.