Will SPAC issuance remain below last year’s level?

**SPAC issuance is likely to remain below last year's level.** Here's why:

1. **Regulatory Changes**: The SEC's new rules and regulations for SPACs, effective July 1, 2024, have increased disclosure requirements and provided additional investor protection. These changes have created a more stringent regulatory environment, which may deter some SPAC sponsors from listing on the U.S. exchanges.
2. **Market Performance**: SPACs have faced significant challenges, including underperformance compared to traditional IPOs and de-SPAC transactions. The decline in profitability in SPAC mergers in Italy and the overall decline in SPAC activity suggest that market sentiment and performance issues could persist.
3. **Investor Sentiment**: Investor sentiment towards SPACs has been influenced by market volatility and regulatory changes. The positive association between SPAC activities and market sentiment indicates that investor willingness to invest in SPACs may be contingent upon market conditions and sentiment.
4. **Economic Factors**: The economic environment, including geopolitical instability and inflationary pressures, has affected investor sentiment and market dynamics. These factors could continue to impact SPAC issuance as investors prioritize stability and certainty over speculative investments.
5. **SPAC Performance Issues**: Specific examples of SPAC underperformance, such as Hyzon Motors, and the challenges faced by Churchill Capital Corp IX/Cayman, highlight the risks associated with investing in SPACs. These issues may lead to a decrease in investor confidence and a subsequent reduction in SPAC issuance.

In conclusion, while there is potential for a recovery in SPAC issuance if market conditions and sentiment improve, the current regulatory environment, performance issues, and economic factors suggest that issuance levels may remain below those of the previous year.