2015 Stock Market Recap: IPO Stream Low in 2015 Due to Market Volatility

By Vlad Tverdohleb | Jan 04, 2016 09:30 AM EST

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The year 2015 has been defined by a volatile trending that led to an adverse market for American and global companies planning to go public.

Silicon Valley's increasing preference for maintaining private ownership and volatility in stock market led to a sharp drop in global listings last year. New listings generated total proceeds lower with almost 30 percent, dropping from $264 billion in 2014 to $194 billion, according to Financial Times.

The number of United States companies making an initial stock public offering in the year 2015 dropped by over 40 percent from 2014. After strong numbers registered first half of the year, in the second half of 2015 the numbers were falling due to a slowdown of China's economy, according to Renaissance Capital's IOP research report.

In the U.S. the amount raised by companies making public offerings in stock was considerable lower as well, going from $85.3 billion in 2014 to just $30 billion in 2015. In the second half of the year investors were worried by sharp swings on Wall Street and companies had to reduce significantly their ambitions.

After the August downturn in the U.S., the market correction in September determined many American companies to hold on their plans to go public, according to Renaissance Capital cited by The Times.

The IPO market was in target for the first eight months of the year to reach over 200 IOSs with solid returns. However, in the months of August and September the market went into a tailspin that drove high IPO discounts, wiped out positive performance and by year-end brought issuance to a near halt, according to the report published by the research firm Renaissance Capital.

According to an interview in Financial Times accorded by Mary Ann Deignan, co-head of equity capital markets at Bank of America Merrill Lynch, most of the hopes of Wall Street for the months of September, October and November 2015 "was postponed to 2016."

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