SpaceX’s mega post-IPO rally has hit the skids.
Shares in Elon Musk’s rocket company are set to drop around 3% at market open on Tuesday, marking a fourth consecutive day of losses for the stock, which boomed more than 50% in its first few days of trading.
The stock is set to open at $150, down more than 30% from the intraday high of $225 per share it hit last Tuesday, and erasing around $400 billion from its closing market capitalization that same day.
SpaceX, which trades under the ticker SPCX, went public in the largest IPO in history earlier in June, raising an initial $75 billion. It then announced that investors underwriting the IPO had exercised an option to buy an extra $10 billion of stock, boosting the total raised to over $85 billion.
On the day of SpaceX’s IPO, the company had a valuation of around $1.8 trillion. That valuation then surged, briefly exceeding $2.7 trillion and making SpaceX more valuable than both Microsoft and Amazon. On Tuesday, June 16, the company closed with a market capitalization of $2.4 trillion.
Should SpaceX’s stock hold onto the losses it has made in premarket trade, the company’s market cap on Tuesday would be $1.96 trillion, roughly $160 billion above its opening valuation.
SpaceX’s fall is part of a broader market sell-off that saw the tech-heavy Nasdaq index drop 1.3% on Monday, with futures pointing to a fall of more than 2.5% at Tuesday’s open.
“As surely as night follows day, SpaceX’s reversal has arrived, bringing the shares back down to Earth and causing euphoric sentiment to sputter,” Chris Beauchamp, chief market analyst at IG, wrote in a morning email.
“And just as inevitably, the losses are of such a size that they cannot be ignored by the broader market. A chill wind is blowing through stock markets around the globe as investors watch the selling.”
