We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Global IPOs Less Likely to Rebound in 2023: ETFs in Focus
Read MoreHide Full Article
After a record year, the global market for initial public offerings IPO was off in 2022. Initial public offerings on the New York Stock Exchange (NYSE) just nosedived this year. This year’s listings collapse is the worst since IPO values dropped 73% in 2008, according to Bloomberg data, as quoted on Yahoo Finance.
Renaissance IPO ETF (IPO - Free Report) is off 55.6% this year while Renaissance International IPO ETF (IPOS - Free Report) has lost 33.8% in the year-to-date frame. By Nov 15, just 173 companies made their debut in the U.S. stock market, down more than 82% from the 973 IPOs by the same time last year. Total proceeds raised were $7.7 billion this year, down 94.4% year over year, per Renaissance Capital. U.S. market is likely to record its lowest IPO proceeds since 2003 this year, per EY.
What Caused the Drop?
Rising inflation caused by supply-chain woes and the resultant rise in interest rates, the stock market crash, geopolitical tensions caused by the Russia-Ukraine war, China’s zero-Covid policy and the finally the global growth slowdown led to the mishap in the IPO market.
What Lies Ahead?
It all depends on global growth worries. The IPO activity is not likely to recoil much in the first half of 2023, as fears of an economic slowdown remain. Some analysts believe that activity may recover by the second half of next year, though chances of such a late recovery is also less.
Per Gareth McCartney, global co-head of ECM at UBS, a slow normalization of the IPO market next year is expected. The United States will likely be the first to recoil and there are early signs of a rebound in America with rising block-trade activity, he added.
Among IPOs that are on the radar ahead are Fortnite owner Epic Games Inc., delivery giant Instacart Inc., and sports apparel retailer Fanatics Inc. Europe will follow the United States, although Asia’s recovery will depend on China’s reopening, per UBS, as quoted on Bloomberg.
The article also revealed that Andreas Bernstorff, who heads equity capital markets at BNP Paribas SA believes that “cyclical and value sectors are likely to be in demand, with energy transition and climate tech companies in particular well-positioned to attract strong demand.” With so many deals postponed or scrapped, the IPO pipeline is getting longer.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Global IPOs Less Likely to Rebound in 2023: ETFs in Focus
After a record year, the global market for initial public offerings IPO was off in 2022. Initial public offerings on the New York Stock Exchange (NYSE) just nosedived this year. This year’s listings collapse is the worst since IPO values dropped 73% in 2008, according to Bloomberg data, as quoted on Yahoo Finance.
Renaissance IPO ETF (IPO - Free Report) is off 55.6% this year while Renaissance International IPO ETF (IPOS - Free Report) has lost 33.8% in the year-to-date frame. By Nov 15, just 173 companies made their debut in the U.S. stock market, down more than 82% from the 973 IPOs by the same time last year. Total proceeds raised were $7.7 billion this year, down 94.4% year over year, per Renaissance Capital. U.S. market is likely to record its lowest IPO proceeds since 2003 this year, per EY.
What Caused the Drop?
Rising inflation caused by supply-chain woes and the resultant rise in interest rates, the stock market crash, geopolitical tensions caused by the Russia-Ukraine war, China’s zero-Covid policy and the finally the global growth slowdown led to the mishap in the IPO market.
What Lies Ahead?
It all depends on global growth worries. The IPO activity is not likely to recoil much in the first half of 2023, as fears of an economic slowdown remain. Some analysts believe that activity may recover by the second half of next year, though chances of such a late recovery is also less.
Per Gareth McCartney, global co-head of ECM at UBS, a slow normalization of the IPO market next year is expected. The United States will likely be the first to recoil and there are early signs of a rebound in America with rising block-trade activity, he added.
Among IPOs that are on the radar ahead are Fortnite owner Epic Games Inc., delivery giant Instacart Inc., and sports apparel retailer Fanatics Inc. Europe will follow the United States, although Asia’s recovery will depend on China’s reopening, per UBS, as quoted on Bloomberg.
The article also revealed that Andreas Bernstorff, who heads equity capital markets at BNP Paribas SA believes that “cyclical and value sectors are likely to be in demand, with energy transition and climate tech companies in particular well-positioned to attract strong demand.” With so many deals postponed or scrapped, the IPO pipeline is getting longer.