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IPO Market Surges Enticing Investors Starved for Yield

NEW YORK (TheStreet) -- The IPO market has been booming, with record-low interest rates in both the U.S. and Europe, equity markets at record levels and investors hungry for growth in this low-growth economic environment all playing a major role.

A PricewaterhouseCoopers report released Thursday said there were a total of 160 IPOs generating $32.4 billion in proceeds during the first half of 2014. That's a jump from 97 IPOs totaling $21 billion in proceeds during the same time last year.

Leading the way in proceed generation were technology, consumer and energy companies.

Towards the end of second quarter, IPO aftermarket returns produced returns of 20.3% on average, significantly outperforming all the broader stock markets even as the Dow and the S&P 500 reached record highs. One-day IPO returns booked average stock price increases of 9.2% during the first day of trading.

Sixty two percent of IPOs priced either above or within their estimated pricing ranges in the quarter as IPO deal volumes soared to their highest levels since the fourth quarter of 2007.

If the current strength of the equity markets continues and the global economic recovery stays on pace, the total number of IPOs and proceeds raised this year may surpass 2013's level of 238 new issuers and $57 billion in proceeds, according to PwC.

-- Written by Andrea Tse in New York

Follow @AndreaTTse

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