The drop comes despite China's Ant Financial announced a deal to buy Dallas-based MoneyGram for $1.6 billion, including debt, and the purchase by Canada's AltaGas of WGL Holdings for more than $6 billion, said Richard Peterson, senior director at S&P Global Market Intelligence.
"In terms of foreign buying in the U.S., it's going to be a cautionary outlook, because there's uncertainty about what the Trump administration will be, because of their 'America First' outlook," he said.
Johnson & Johnson's roughly $30 billion deal to buy Swiss biotech firm Actelion last week accounted for the bulk of U.S. acquisitions of foreign targets in January, S&P said.
Peterson said corporations were waiting to see what changes are made to tax repatriation policy and what the Treasury Department's stance on antitrust regulation will be.
Democrats have boycotted Steven Mnuchin's confirmation for Treasury secretary. The Obama administration took a stance against several large tie-ups, working against consolidation in industries and preventing cross-border deals as U.S. companies attempted to cut their U.S. taxes by combining with overseas firms.
So far this year, the bulk of announced corporate deals in the U.S. have been in energy and health care, Peterson said.
He attributed the pickup in corporate deal-making around the world to positive sentiment, credit availability and gains in share price that give companies more buying power. There's "a lot in the pipeline," he said. It "could well be a record year."
Corporate bond issuance hit $174.03 billion in January, the second biggest on record since May 2016 and the busiest January ever, according to Informa Global Markets. The rush to issue bonds comes ahead of potential changes in tax policy and additional interest rate hikes by the Federal Reserve.