October was the biggest month ever for mergers and acquisitions in history.
Biggest. Ever.
Nearly $500 billion dollars’ worth of global deals were announced, including the biggest one of the year, AT&T’s $85.4B bid for Time Warner.
That’s the highest amount for at least 12 years, topping the previous record of $471 billion in April 2007, the data show.
It’s worrisome for a number of reasons, according to Hedgeye CEO Keith McCullough. As he reminded subscribers on The Macro Show, the last time M&A hit an all-time high it was … (drumroll) July 2015.
Let’s take a closer look at what happened following the last peak:
- The last high in M&A activity coincided with the all-time high in global equity markets in June 2015
- As investors may recall, global equity indices lost -10.7% (or $8 trillion in market cap) from the all-time high
- The Russell 2000 also put in its all-time high in June. The small cap index is down -7% since
This latest data point is another reason why we believe investors should err on the side of caution right now.
