M&A Activity is little more than rumor at this point, and bad rumor at that.
Sure, there will be some deals done, but the pace has and will continue to markedly slow.
Q1 earnings were okay, but if you look at the actual data, many companies that beat (lowered estimates, by the way), did so disproportionately by cost cutting measures, which boosted net revenues (a lot of companies outright missed, too).
Stock buybacks occurred on a tear for the last 9 months, but this is slowing, too (if someone has aggregate buyback data with specific time frames, please post it).
The U.S. economy undeniably continues to weaken, and consumers are starting to once again increase their credit card debt at a very high rate (much of that debt is from inelastic products like gasoline, groceries and medications).
Housing and subprime represent an undeniable obstacle, and even drag, on consumer and business investment (the former, directly, the latter, indirectly).
Private equity is buoyed by the carry trade and ridiculously complacent capital pools, fueling purchases of assets priced at the peak of the business cycle, not the trough - no matter, the managing partners are making big cash.
Now that the U.S. equity market has gained in 10 months what it historically typically takes to gain in years:
Where do you think the catalyst for future share appreciation will come from?
Or is the greater fool theory already at work And if so, who is the fool? The buyer or the seller?
Its been at work for months already though more in foreign markets than in US markets. Liquidity crunch coming up shortly either way.