Companies listing on U.S. stock markets raised just $15.3 billion (£11.2 billion) in the first half of the year, marking a 13% year-on-year decline and the lowest IPO total in two years, according to data from LSEG.
The $2.3 billion (£1.7 billion) drop comes amid growing market uncertainty triggered by President Donald Trump’s aggressive tariff policies.
In sharp contrast, Chinese IPOs surged by 45% over the same period, reaching $8.6 billion (£6.3 billion), highlighting a divergence in investor sentiment between East and West.
The pullback in U.S. IPO activity follows President Trump’s escalation of trade tensions, which has disrupted global supply chains and rattled financial markets. His move to impose new tariffs on 14 trading partners has fuelled economic uncertainty, despite later suggesting his August 1 deadline for the tariff hikes was “not 100% firm.”
Mark Zandi, chief U.S. economist at Moody’s, warned the uncertainty is already weighing on business activity: “If the policy uncertainty remains, it delays IPOs, it delays business formation, it will have an impact on productivity growth. And it’s been those productivity gains that are the U.S. secret sauce.”
The dollar weakened against major currencies following Trump’s softer tone on tariffs, while Asian markets rebounded on signs that the latest trade measures may not be as rigid as initially feared.
Kathleen Brooks, analyst at XTB, commented: “The President may have hit Japan, South Korea, and other trade allies with tough tariff rates on Monday, but even these aren’t set in stone. The market reaction on Tuesday reflects this.”
Traders dubbed the response the “TACO trade”—short for Trump Always Chickens Out—as investors bet that the administration may backtrack under pressure.
