According to Melissa Sawyer, Global Head of M&A at Sullivan & Cromwell, the volume of deals will be the true barometer of a resurgence in the M&A market. She believes that a revitalized IPO market is an early signal that private equity firms are gaining confidence to exit portfolio companies. This influx of capital could then fuel fresh acquisitions and mergers.

Sawyer also pointed to a shift in the tone coming from Washington, which has helped to bolster confidence among companies considering transactions. The M&A market has been sluggish recently due to economic uncertainty, rising interest rates, and regulatory scrutiny. A strong IPO market often precedes a flurry of M&A activity as sponsors seek exits.

The health of the IPO market is therefore a critical indicator for investors. Increased deal flow would be welcome news for investment banks, law firms, and other advisors that profit from M&A activity. The interview on "Bloomberg Deals" with Dani Burger highlighted the importance of monitoring these trends.

Next, market participants should watch the performance of recent IPOs and the overall economic data to gauge the sustainability of this trend. If IPOs continue to perform well and economic conditions stabilize, a robust M&A market could materialize, benefiting various sectors. This would lead to more deals and higher valuations.