Doldrums, not dazzle, for deals

NEW YORK -- Blame lasting effects of the stock market’s worst start ever to a year. Blame uncertainties about the economy and interest rates. Blame the government. But one thing is for sure, it’s been a bad year for deals.

First, look at mergers and acquisitions. So far, just $266 billion worth of U.S. deals have been announced in 2016, Dealogic says. If that pace keeps up, the deal total at the end of the year will be half the $2.3 trillion total for 2015.

And that’s if the pace keeps up. With scuttled mergers such as the $160 billion tie-up between Pfizer and Allergan, this could be a record year for canceled deals, Richard Peterson at S&P Global Market Intelligence says.

Then consider IPOs. Companies aren’t exactly eager to sell their stock to the public for the first time. So far just nine companies have launched initial public offerings in 2016, a 75% drop from a year earlier, Renaissance Capital says.

There are some glimmers of life in IPOs. Aeglea Biotherapeutics started trading Thursday, though it had to slash its IPO price to $10 from the $16-$18 expected range. And the first non-biotech IPO of the year, exchange operator Bats Global Markets, could be out next week.

But a healthy deal market needs a healthy stock market. And stocks have started to look wobbly again. Add to that the souring mood toward mergers in Washington, and there’s not exactly reason to expect the  doldrums to lift soon.

Senior Markets Editor David Craig on Twitter: @davidgcraig.