Thu, Mar 2, 2023
Capital Markets Insights – Winter 2023 – A Look Back at 2022
- Major U.S. indices declined in 2022 as the Federal Reserve raised interest rates in response to inflation.
- The DJIA decreased 8.8%, the S&P 500 declined 19.4% and the NASDAQ decreased 33.1% since December 31, 2021.
- U.S. companies raised $180 billion in IPOs in 2022, 61% lower than in 2021.
- Approximately 170 SPACs went public in 2022, compared to 771 in 2021, as the SEC increased their scrutiny of blank
- Initial jobless claims came in at 204,000 for the week ended December 31, 2022, a comparable level to the 224,000 in early January 2022.
- The yield on 10-year U.S. Treasury notes increased from 1.51% as of December 31, 2021, to 3.87% as of December 31, 2022.
- The CBOE Volatility Index (“VIX”) closed at 21.67 on December 31, 2022, a 25.8% increase since December 31, 2021.
- The value of the U.S. dollar strengthened as investors sought a safe haven.
Top News Stories -Wall Street Journal/Financial Times
September 23, 2022: U.K. in Disarray
“The government of new Prime Minister Liz Truss unveils big tax cuts and new spending to spur growth, but the plan sparks a financial-markets crisis that will lead to emergency intervention by the Bank of England.”
November 3, 2022: Fed Keeps Raising Rates
“The Federal Reserve lifts interest rates by 0.75 percentage point for the fourth consecutive time, and signals plans to keep raising them, possibly to higher levels than previously anticipated.”
November 6, 2022: Capital Dries Up
“The Fed’s rate increases have sucked capital out of the markets, with mergers and stock and bond offerings slowing in October to the lowest level in over a decade.”
November 11, 2022: Crypto Collapse
“Cryptocurrency platform FTX files for bankruptcy protection—a swift demise for a company seen as a trusted platform just a week earlier.”
December 13, 2022: Inflation Eases
“Consumer prices rose 7.1% in November from a year earlier, the slowest pace since December 2021, the Labor Department reports. ”On December 14, “The Federal Reserve raises rates 0.5 percentage point, down from 0.75 point for recent increases, but also raises its estimate of how high rates will go in this tightening cycle.”
Corporate Finance and Restructuring
M&A advisory, restructuring and insolvency, debt advisory, strategic alternatives, transaction diligence and independent financial opinions.
Mergers and Acquisitions (M&A) Advisory
Kroll’s investment banking practice has extensive experience in M&A deal strategy and structuring, capital raising, transaction advisory services and financial sponsor coverage.
Distressed M&A and Special Situations
Kroll professionals have advised hundreds of companies, investors and other stakeholders at all stages of distressed transactions and special situations.
Preparing a Family Business for Sale
Discover how Kroll’s M&A Advisory and Investigations teams helped a family company sell their business through constructing a robust financial projection model to attract lenders and investors.