Slowing deals are a flashing red sign for equities

 Financial Times Europe 10 Oct 2026

 Think of it as a bull mar ket with no horns. Earlier this week, the S&P 500 hit an alltime high, a scen ario that would nor mally come with a frenzy of mer gers, acquis i tions and pub lic offer ings. Rising prices usu ally lead to rising animal spir its, after all. But after what looked like a healthy start to 2026, cor por ate deal mak ing has proven oddly muted. Sev eral high-pro file list ings, like that of OpenAI, fit ness tracker Oura (pic tured) and Soft Bank’s green field data centre builder SB Energy, have been post poned. Reas ons vary: SB Energy is still wait ing for reg u lat ors to sign off. But out side of buoy ant equity prices, con di tions aren’t ter ribly friendly. Interest rates, which impact com pan ies’ cost of cap ital, are rising. Con sumer con fid ence has been hit by higher prices and mort gage rates, as well as weak job hir ing trends. 

And the S&P 500 isn’t neces sar ily the best indic ator of sen ti ment. Tech accounts for 40 per cent of the index, which has far out per formed the more broad-based Rus sell 2000. Yet the titans in its roster are not just a play on AI. Alpha bet and Meta Plat forms, for example, have huge advert ising busi nesses that already throw off huge amounts of cash. That sets them apart from a loss mak ing pure-play AI com pany like SB Energy. In the third quarter of the year, global M&A fell below the psy cho lo gic ally import ant $1tn level. The boutique invest ment banks that rely on deal fees have been feel ing the chill. Shares in Ever core, the biggest of the spe cial ist firms, are down nearly a quarter this year. Per ella Wein berg is close to selling itself to a diver si fied rival, accord ing to press reports. The big banks are in a slightly bet ter pos i tion, since volat il ity has been good for trad ing. The State of New York recently dis closed that broker deal ers in the first half recor ded record profits of $46bn, up 50 per cent rel at ive to 2025. Gold man Sachs is happy enough with its prowess to give another $500mn spe cial bonus to its brass.

Ana lysts expect its over all invest ment bank ing fees to rise 30 per cent for the full year, accord ing to LSEG, faster than in 2025. The M&A slow down doesn’t reflect any not able change in how much com pan ies might bene fit from team ing up. What changes is man agers’ appet ite for risk, which has been hit by rising yields and AI jit ters. The diver gence between boom ing stocks and dwind ling deal volumes will even tu ally close — although it’s most likely a fall in the equity mar ket that will make that hap pen.