Weekly Market Updates: 4/29/19

Cannabis M&A Spiked Last Week with Four Deals in the U.S.

Pitchbook data shows M&A activity slowing last week, with $3.6 billion invested across 24 deals, $11.2 billion capital and seven deals fewer than the week prior. Japanese multinational conglomerate Hitachi shelled out $1.43 billion for Michigan-based industrial robotics integrator JR Automation in the week’s largest deal. Deal making in the cannabis space was hot last week, with four U.S. cannabis producers and distributors being acquired.

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Uber Prices IPO, Expected to Go Public in May

​There were no new initial public offerings last week, according to the New York Stock Exchange, after seven companies had IPOs the week before. Progress still continues toward more tech unicorn IPOs. On Friday, Slack filed its public S-1 filing, revealing $400 million in revenue. Also, Uber officially priced its IPO range, with a maximum $90-billion market cap.

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Consumer Sentiment Remains High while Durable Goods and New Home Sales Outperform

Among economic news last week:

• The University of Michigan’s consumer sentiment survey fell slightly in April to 97.2, down from 98.4 in March, beating surveyed economists’ expectation of 97. The drop is not necessarily cause for concern, however, as the index has averaged 97.2 over the last 28 months, near historical highs. April’s report suggests that consumer spending is poised to pick up in the coming months, as 44% of respondents said they expect financial prospects to improve, while 8% expect them to worsen.

• Last week, orders for durable manufactured goods rose in March by 2.7%, the fastest pace in over half a year. Economists were expecting an increase of only 0.8% in the month. Much of the spike is attributed to demand for aircraft and aircraft parts, which jumped 31.2%. A proxy for businesses investment, orders of non-defense capital goods, excluding aircraft, was up 1.3% in March, after being up only 0.1% in February. Compared with the same period in 2018, business investment increased by 2.8% in the first three months of 2019.

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• New home sales have risen to a one-and-a-half year high in March on the back of lower mortgage rates and house prices. Sales of new U.S. single-family homes increased 4.5% in March, the highest level since November 2017. Economists were predicting a 2.5% decrease in the month. March marks the third straight month of increases in new home sales, despite other housing sectors, such as pre-owned home sales, struggling. New home sales haven’t experienced the same supply problems that have impacted home-sellers’ ability to find new, cheaper housing.