“For many, this year’s stock market rally has been really something. But investors and bankers on Wall Street worry it may be based on a whole lot of nothing, which is why they aren’t doing much of anything.
The Dow Jones Industrial Average has forged a path higher, marking its best start to a year since 1998. And on Monday, the Dow notched its 45th consecutive trading day without a triple-digit decline—the longest streak since 2006. Investors contained the decline in the blue-chip index to 14.76 points on Monday.
The market’s fear gauge—the CBOE Market Volatility Index, known as the VIX—has tumbled since August.
Such pleasant conditions would typically be celebrated by investors and considered a boon for Wall Street investment bankers and their clients seeking to put together mergers and acquisitions or initial public offerings.
Bloomberg NewsHeadwinds that investors see include rising oil prices, Europe’s unresolved debt troubles and elections in the U.S.
Instead, initial public offerings are in a slump, and mergers and acquisitions activity by some measures is the lowest since 2008, according to data firm Dealogic. As a result, investment banking fees are down by a third.
Recalling last year’s swings, some investors worry that volatility—or market declines—may be afoot. “We cannot continue this upward movement forever,” said Reed Choate, portfolio manager at Neville, Rodie & Shaw, a New York firm with $1.2 billion under management….”
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