Equity markets globally saw signs of life in September after the seasonal summer slowdown. Most markets are still below their pre-Lehman collapse levels, although Brazil, India and China are now up year-over-year. Volatility dropped for a sixth straight month while the IPO and M&A markets showed renewed activity

Highlights:

• Financial market activity increased as expected in September, with trading volume globally and across asset classes recovering from a typically slow August. In the third quarter 2009, trading activity declined relative to the prior and year-ago period.
• September witnessed a sharp rise in initial public offerings, with the merger and acquisitions market showing signs of life as well. Both IPO and M&A activity have remained largely dormant since summer 2008 as credit markets seized and risk appetite on the part of investors globally declined dramatically.
• Equity markets continued to rally in September and throughout Q309 while volatility continued its march lower. While the DJIA and S&P 500 ended the month down from one year ago, the equity markets in Brazil, India and China all posted gains over the same period.
• In the U.S., equity mutual funds experienced net outflows in September for the first time since March 2009. Conversely, flows into bond funds posted their best month in several years.