While dealmaking activity dipped in September, there may still be a chance for it to return to pre-pandemic levels. Mitch Berlin, EY Americas vice chair of strategy and transactions, joins Asking for a Trend to discuss the outlook for M&A (mergers and acquisitions) activity.

Berlin explains that overall, there is a "healthy backdrop" for M&A activity despite a recent pullback. He believes there will be continued softness throughout the election season, noting that about 34% of CEOs EY surveyed stepped away from deals due to the high cost of capital. He adds, "It's also hard to build volatility into your models when you don't know where that source of volatility is coming from. And so under one administration, that volatility can be coming from transacting in areas like China. From under another administration, that volatility can come from greater regulatory scrutiny and delayed deals."

Thus, once the election passes, he believes there will be more certainty, and M&A activity will pick back up. He expects the tech sector, in particular, to see some of the most mergers and acquisitions, as it has led the charge over the past four years.

He tells Yahoo Finance, "You have non-technology companies that need technology to improve their front office operations, their back office operations. And then you have the general desire to acquire AI. And clearly, cyber technology is top of mind for everyone today. So tech is really top of the charts."

Outside of the tech sector, Berlin also expects M&A activity in the consumer product space, especially around food and beverage. He also highlights life sciences and oil and gas to continue to see deals.

To watch more expert insights and analysis on the latest market action, check out more Asking for a Trend here.

This post was written by Melanie