JPM's O'Donnell Expects a Pickup in M&A Activity

• Markets are taking geopolitical tensions in stride, with only minor shifts in leveraged loan and high-yield pricing.
• Overall issuance volumes are expected to be similar to last year, but with a shift from refinancing to M&A activity and growth capital.
• The forward M&A calendar is manageable (3% of market volume vs. 30% pre-GFC) and of higher quality, featuring more equity than debt.
• While private credit has higher software exposure, the leveraged loan market's performance is positive when software is excluded, indicating a bifurcated market.

JPMorgan's Catherine O'Donnell discusses the resilience of financial markets despite geopolitical tensions and AI disruption. She anticipates a shift in leveraged finance towards M&A and growth capital, with overall issuance volumes remaining robust. The market's underlying fundamentals, consumer health, and cash availability are highlighted as key strengths.