Initial public offerings are a difficult prospect under the best of the times, but companies looking to go public right now are hardly facing the best of times. The Associated Press reports that the substantial hit taken by the market in the past week has forced eight companies to cancel their IPOs.
So far this year the Dow Jones Industrial Average has only fallen around 5 percent at this point, but the important index has fallen 10 percent in the past month and plummeted in the wake of the decision from Standard and Poor's to reduce the U.S.' credit rating. This uncertainty has turned many investors away from potentially more questionable companies, making particular trouble for companies like Groupon that have yet to post a profit.
"This kind of movement in the market that we've seen is definitely going to put IPO plan on hold for many companies," Darren Fabric, managing director of IPOX Capital Management, told the AP.
The IPO market was expected to take off this year, with some analysts predicting at the beginning of the year that there might be as many as the past three years combined, which would amount to more than 248. With 93 IPOs completed to this point, only one so far in August and another eight canceled for next week, those projections seems overly optimistic.