Bankers expect global trading volume to surpass $4 trillion next year, the highest in four years, buoyed by U.S. President-elect Donald Trump’s promise to ease regulation, cut corporate tax and adopt a largely pro-business stance.

The total value of mergers and acquisitions (M&A) increased 15% from last year to $3.45 trillion as of December 19 this year, according to Dealogic data, recovering from a low of a decade of about $3 trillion over the same period last year.

Top dealmakers expect U.S. antitrust enforcement to be more deal-friendly next year to unblock tie-ups that were put on hold under the Biden administration. Trump recently nominated Andrew Ferguson to replace Lina Khan as chair of the Federal Trade Commission, naming a current Republican member of the agency who is expected to loosen its control over large company mergers.

“Leaving aside 2021, next year could be one of the best in the last 10 years as there hasn’t been much volume volatility over the last decade. If global M&A volumes increase by 15% or 20% next year, that would be the case. This won’t surprise us at all,” said Jay Hofmann, co-head of North America mergers and acquisitions at JPMorgan Chase.

M&A volumes in the United States have climbed 10% to $1.55 trillion year-to-date, while Europe and the Asia-Pacific region have seen a 22% and 11%, with volumes hovering around the $800 billion mark.

Recent interest rate cuts, improved financial environment and resumption of IPOs are expected to improve the fortunes of private equity firms, which have been unable to sell or list companies in portfolios worth billions of dollars over the past two years, as buyers and sellers Investors failed to agree on asset prices and capital markets were largely closed to large IPOs in sotck exchange.

“The IPO market is improving and that really helps some of the larger assets that are in sponsor portfolios where that might be the only monetization outlet,” said John Collins, global co-head of IPOs. mergers and acquisitions at Morgan Stanley.

Leveraged buyout volumes jumped 35% to $600.8 billion this year, as private equity firms braved tough market conditions to take several companies private, while winning buyouts of big targets . Blackstone’s $16 billion acquisition of Australian data center operator AirTrunk and Silver Lake’s $13 billion privatization of entertainment conglomerate Endeavor Group rank among the year’s top LBOs.

Some investment bankers have warned that planned tariffs under President Trump could prove to be a headwind for the US economy, as they could drive up inflation. On Wednesday, the U.S. central bank said further cuts in borrowing costs would depend on further progress in reducing stubbornly high inflation.

“There’s a lot of opinion that the Trump administration is going to open the floodgates to deals. We’re seeing less of that and we’re a little more cautious about the extent of the changes,” said Stephen Pick, head of mergers and acquisitions. for the EMEA region at Barclays.

Mars’ takeover of Cheez-It maker Kellanova for $36 billion; Capital One’s $35 billion deal for Discover Financial; and Synopsys’ $35 billion takeover of design software maker Ansys were the year’s largest M&A deals.

“Discussions around larger transactions are happening and will continue to happen because the environment will be more predictable (in 2025) than it was under the recent administration,” said Krishna Veeraraghavan, co-head global M&A group at Paul. Weiss, Rifkind, Wharton and Garrison.

While the number of transactions worth more than $10 billion grew at a steady pace in 2024, the total number of transactions declined compared to last year as a strict regulatory environment and uncertainty of the election year have forced companies to postpone their pursuit of transformational mergers. Despite these headwinds, 37 deals valued at more than $10 billion have been announced, up from 32 last year.

A booming U.S. economy, pent-up demand and trillions of dollars of unspent capital on company balance sheets are expected to lead to an increase in deals in the near term, bankers said. Leading investment banks are beginning to accelerate their hiring to ensure deal teams are fully staffed to handle the expected increase in deal volumes.

“With Trump cutting taxes and promoting deregulation, companies may be more willing to invest their cash in mergers and acquisitions, instead of distributing it to shareholders,” said Nestor Paz-Galindo, co-head global mergers and acquisitions team at UBS.

As the earnings outlook for U.S. companies improves, cross-border M&A activity is also expected to improve, with foreign buyers seeking cash increasingly turning to attractive U.S. targets. Fast-growing Asian economies are also increasingly seen as attractive to opportunistic private equity firms.

“Given their unique dynamics and tailwinds, Japan and India have both seen growing sponsor attention translate into strong deal volume momentum and we expect this to continue for both markets in 2025 with the return of sponsor mergers and acquisitions globally and in the region,” said Raghav Maliah. , global vice president of investment banking at Goldman Sachs.

Deal advisors noted that the pace of deals through 2025 is starting to return to levels seen in the pre-pandemic years of 2018 and 2019, when deal volume averaged around $4 trillion per year.

A series of major deals have been announced in recent weeks, including Omnicom’s $13 billion merger with rival advertising giant Interpublic Group and Arthur J. Gallagher’s purchase of insurance broker AssuredPartners for $13.4 billion. billion dollars.

“People who are predicting that everything will start from January are probably a little too optimistic. Everything is moving in the right direction. I’m not convinced we’ll see another (record) year like 2021, but I’m hopeful that it will be a little more like 2019 or 2020, just before COVID,” said Daniel Wolf, M&A partner at Kirkland & Ellis.

The technology sector accounted for the largest share of M&A activity this year, jumping more than 20% year-over-year to $534 billion globally.

“The types of deals we’re seeing happening are the type we’ve seen less of over the last couple of years and there’s a sense that there’s a lot of excitement about doing large, transformational deals,” said Mark Bekheit, Global Vice President. chair of the M&A practice at Latham & Watkins.