Thanks to record issuance, the SPAC boom and the pandemic-fueled collapse in buybacks, the supply of equities across the developed world has turned positive for the first time in a decade, according to Sanford C.
What started as a rush to shore up balance sheets during the Covid crisis has morphed into a spree of deals to tap relentless investor appetite for a market defying historic valuations.
American companies last quarter announced $339 billion of repurchases, a 68% rise from the depths of the pandemic selloff a year ago, though still short of $569 billion during the 2018 heyday, according to EPFR Global Inc.
Fueled by merger activity, the private equity boom and American firms buying back shares en masse, the shortage of stocks in the pre-virus days helped juice the bull market.
With returns diminishing across the fixed-income world, equities are increasingly seen as the only game in town.
While the global economy is only just emerging from the 2020 doom and gloom, a listing spree and elevated valuations are typically symptoms of greed in the dying stages of the business cycle.