Morgan Stanley co-president sees dramatic improvement in deals outlook

Group 1 - Morgan Stanley co-president Dan Simkowitz highlighted a "dramatic improvement" in the deals outlook, indicating increased confidence among companies due to deregulation policies, tax cuts, and potential interest rate cuts [1][2] - After three years of low activity in capital markets and M&A, there is a significant backlog of deals expected to create a multi-year stream of transactions as companies react to new U.S. policies [2] - The restructuring of industrial policy in the U.S. is impacting supply chains and asset allocation for multinational companies [2] Group 2 - Financial sponsors are beginning to monetize their companies, driven by investor demand for returns and compensation triggers for private equity executives [3] - Morgan Stanley estimates there are approximately 1,500 private equity-owned companies in the U.S. valued at least $1 billion, indicating a strong pipeline of future deals [3] - The reopening of the IPO market is reducing execution risk in M&A deals, exemplified by Morgan Stanley's leadership in the $1.37 billion IPO of Klarna [4] Group 3 - Morgan Stanley is experiencing significant organic growth opportunities in trading and wealth management, with potential for acquisitions in these areas, although they would need to meet high approval standards [5][6] - CEO Ted Pick has echoed sentiments regarding potential acquisitions, continuing the legacy of previous leadership that transformed Morgan Stanley into a wealth management powerhouse [6]