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Investing.com - Global corporate share buybacks are on pace to reach a record $1.9 trillion in 2025, according to a new JPMorgan report released Thursday. The financial institution noted that buyback activity has already matched last year’s total of $1.37 trillion in just the first eight months of this year.
The current pace represents 38% annual growth compared to the same period last year, significantly outpacing the 15% rise in equity prices and indicating a substantial increase in buyback volumes. Despite reaching record dollar amounts, JPMorgan’s analysis shows that buybacks as a percentage of total market capitalization remain close to or below historical averages.
For U.S. companies specifically, current buyback volumes stand at 2.6% of equity market capitalization, almost half of the peak level of nearly 5% reached in 2007. JPMorgan suggests U.S. share buyback volumes have "further room to increase" toward the 3-4% range seen before the pandemic, potentially adding another $600 billion on top of the current record $1.5 trillion annual pace.
The strong buyback activity, combined with subdued IPO performance, has kept equity supply in negative territory for an unprecedented fourth consecutive year. This ongoing reduction in publicly-listed share count continues to provide support for equity markets from a supply perspective.
JPMorgan had previously highlighted in a May 7 publication that corporate buyback activity was particularly strong in the first half of the year, especially in April and May, as companies "backstopped the equity market following Liberation Day."
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