By Divya Chowdhury and Lisa Pauline Mattackal
DAVOS, Switzerland (Reuters) – Initial public offering activity should recover in 2024 as borrowing costs come down and equity markets are less volatile, the vice-chair of the New York Stock Exchange said in an interview on Monday.
“We have a robust pipeline from across sectors and geographies,” John Tuttle told the Reuters Global Markets Forum ahead of the World Economic Forum’s annual meeting in Davos. “It’s just finding that time when investors have the appetite for these companies, and companies are ready to go.”
After 2016, IPO activity had been at its lowest level in 2023, as rapid interest rate hikes and uncertainty over global economic growth crimped investor interest in new listings.
Tuttle attributed the pickup in confidence to more stability in U.S. interest rates, record-high equity indexes and relatively low market volatility.
“We certainly see an upward trajectory, (with IPO activity) returning to the mean,” he said.
Tuttle, however, added that the levels of IPO activity and equity issuance seen in 2020 and 2021 were unlikely to return anytime soon.
He cited the IPO of Smith Douglas Homes, which notched a valuation of $1.21 billion in its market debut on Thursday, as evidence of the market’s resurgent interest.
The November U.S. elections will also influence the timing of companies coming to market, Tuttle said, adding that he expected a window of activity in the late summer leading up to the election and another one post-election.
On newly listed exchange traded funds (ETFs) tracking the spot price of bitcoin, Tuttle said the NYSE saw significant demand from both institutional and retail investors as the funds began trading, and the exchange continues to monitor the market for new demand.
(Join GMF, a chat room hosted on LSEG Messenger: )
(Reporting by Divya Chowdhury in Davos and Lisa Mattackal in Bengaluru; Editing by Mark Porter)