Global mergers and acquisitions activity slowed sharply in the third quarter, with US deal volume falling nearly half from the second quarter to $535 billion, according to Mergermarket data. The decline follows a spring wave of megadeals, including SpaceX's $55 billion acquisition of AI coding platform Cursor, announced in June, and NextEra Energy's $67 billion merger with Dominion Energy, disclosed in May. Mergermarket head Lucinda Gutherie said the market is at a crossroads, noting that third-quarter seasonal softness can reflect time spent completing large transactions and bankers taking vacations. However, the Federal Reserve's 25-basis-point rate increase, multidecade-high Treasury yields, higher financing costs, pressure on stock values, calls to slow the artificial intelligence race and the lengthening US war in Iran have added reasons to delay deals. UBS analyst Erika Najarian said a weak bond market points to a deeper freeze beyond the seasonal lull. Investors will assess the outlook when major Wall Street banks report quarterly earnings later this month. Bank of America CEO Brian Moynihan cited at least a 10% year-over-year decline in investment banking fees, while JPMorgan forecast mid-to-high-teens growth and Citigroup expected single-digit growth. Analysts remain hopeful that a recovery in private equity exits can support dealmaking, but Oura's postponed initial public offering and continued pressure on midsize private equity companies show that the rebound faces obstacles. PwC said its pipeline and deal volume are considerably higher year over year, although failed deals continue to increase.