The second quarter of 2022 saw a decline in global IPO activity, reaching five-year lows. While there was meaningful IPO activity in China and the Middle East, inflation remains the biggest risk to equities, with combined slowing global growth and the risk of stagflation. Global IPO markets were affected by inflation, slow global growth, the war in Ukraine, and investors' risk appetite and sector positioning, leading to a preference for defensive stocks and sectors with a positive outlook. The renewables sector is expected to see increased activity due to the acceleration of the clean energy transition and a move away from fossil fuel dependencies. IPO volumes were significantly lower compared to the previous quarter and the start of the Covid-19 pandemic, with the US Federal Reserve's rate hike path closely watched by market participants. The US equities bounce suggests that investors are starting to price in no further rate increase from the Federal Reserve. The European IPO market has seen a recovery, with a strong pipeline of IPOs expected in the second half of 2022.
