Interest rates have also directly impacted company valuations. Since valuations are the foundation of any investment banking transaction, increasing interest rates have also meant that the discount rate of DCF models has increased. This directly impacts company valuations in both private and public markets. It becomes fairly easy for companies to be unwilling sellers and, therefore, push deals to later periods or attract only more demanding buyers who solicit better terms of financing.
High interest rates favour bonds more than equities in equity markets, thus diminishing the demand for equities and forcing the stock prices downward. This tends to squash IPO activity since companies will postpone an IPO if they do not feel they could be able to arrive at a favourable valuation in a rising-rate environment.