Announced M&A volumes of $29.6 billion declined by 31% from the prior week. M&A volumes are up +10% from the first quarter of 2012.
Sandler O’Neill’s Weekly M&A Trends:
Equity markets had their best week since late December
- The S&P 500 rose by 3.7% and the Russell 2000 growth index rose by 4.7% in the week. Quarter to date the S&P 500 has declined by 5.9% and the Russell 2000 growth index has declined by 7.8%.
- Average daily U.S. equity trading volumes decreased by 9.5% in the week. Quarter to date volumes are now 1% higher than the 1Q12 average. Average daily U.S. volumes reflect the total number of shares traded on Tape A, Tape B, and Tape C in millions.
- Equity mutual funds experienced net inflows of $1.5 billion in the week according to ICI data (on a one week lag). Flows had been negative in the previous four weeks before experiencing inflows in the most recent week. However, flows have still been negative in twelve of the previous fourteen weeks.
- Volatility, measured by the average CBOE VIX, declined by 3.3% to 23.2, and the DB currency VIX declined by 7.7% to 11.3.
Investment banking activity was quiet across the board on the week
- Equity underwriting volumes of $8.1 billion declined by 19% from the prior week’s level. Quarter to date, equity underwriting volumes are averaging 20% below the 1Q12 weekly average. We note that there have been no IPO pricings since Facebook’s $16 billion IPO on May 18. Note: prior weeks are subject to revisions.
- Corporate debt underwriting volumes of $36.5 billion declined by 23% from the prior week. Quarter to date, corporate debt underwriting volumes are averaging 39% below the strong 1Q12 weekly average.
- Announced M&A volumes of $29.6 billion declined by 31% from the prior week. Quarter to date, announced M&A volumes are averaging 10% above the 1Q12 weekly average.
- Completed M&A volumes of $14.7 billion declined by 53% from the prior week. Quarter to date, completed M&A volumes are averaging 17% above the 1Q12 weekly average.