Daily Management Review

IPO, M&A markets sink down in Q3


10/01/2019


The global equity market in the first three quarters fell by 18% amid concerns over global economic growth prospects and ongoing geopolitical problems, including the US-China trade war. The Asian market experienced an even stronger decline (by 22%). M&A volumes during this period also declined quite significantly - by 11%, to $ 2.8 trillion.



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The amount of funds raised through stock markets around the world decreased by 18% in the first three quarters of this year; this is the worst figure since 2012, say Refinitiv experts. Such results stem from the prospects for global growth, growth of a number of the most important economies in the world, as well as continued geopolitical instability.

Last but not least, the protests in Hong Kong and the trade war between China and the United States affected the global equity market: the volume of the equity market in the Asia-Pacific region (APR) decreased during this period by 22%, to $ 147.8 billion; especially the IPO market decreased by 40%, to $ 40.9 billion. In the case of China, the IPO volume almost halved, to $ 26.7 billion.

In the third quarter, the Asian market was supported by IPO of the local subsidiary of the Anheuser-Busch InBev brewing company - Budweiser Brewing Company APAC - for $ 5 billion.

The European equity market fell by 23%, to $ 88.6 billion, IPO volumes also by 40%, to $ 17 billion. The American equity market grew slightly in the first three quarters - by 6%, to $ 203.8 billion, and funds, raised during the IPO, increased by 5%, to $ 41.7 billion. However, experts see some problems: several technology companies, including Uber, Lyft and Slack, have conducted IPOs since the beginning of the year, and their shares started falling. In turn, this caused investor caution in relation to such IPOs. Recently, another technology service, WeWork, canceled the IPO, which was originally scheduled for September.

source: reuters.com