History’s Largest IPO Landed, and the Market Barely Cheered. Here Is What It Was Really Watching.
For weeks the market’s worry had one name: the SpaceX cash drain. On Friday it resolved, and resolved spectacularly. SpaceX pulled off the largest IPO in history, raising $75 billion, more than double the old Saudi Aramco record, instantly becoming the most valuable public company in the world. The frozen cash flowed back, the stock popped from a $135 issue price to close near $161, and all three indexes rose. The overhang that pressured stocks for weeks is gone. So why does Fear and Greed still sit at 34, stuck in fear?
Because the same Friday afternoon, a harder fact landed quietly underneath the fireworks. Interest-rate swaps now price a 100 percent probability of a 25 basis point rate hike, pushed out to January 2027. A few weeks ago the market was still debating whether a hike would even happen this year. Now it is no longer a question of if, only when. The market got its big relief event and a rate hike turned from a maybe into a certainty on the same day, which is exactly why the rally was softer than the bulls wanted. The IPO popped, then faded, and the indexes could not reclaim the prior Friday’s high.
The next catalyst is already on the calendar: Kevin Warsh chairs his first Fed meeting on June 16 and 17. The chatter is that he may scrap the dot plot or trim the post-meeting briefing to dampen volatility, and a market this twitchy about rates will hang on every word. Underneath that, the IPO floodgate Friday opened is not closing: SK Hynix, OpenAI and Anthropic are all queued, which can keep some heat in the tape.
The warning is to read the relief correctly. The trend is not broken: the S&P rising trend is intact and the Dow, the safe haven, sits nearest its record high. But the real overhang was never the IPO or even the Iran war, where a peace deal is still hoped for by the June 21 solstice. It is the rate clock, and that clock just hardened to 100 percent. Resistance sits directly overhead at the 10 and 20 day lines. Do not mistake a relief pop for a green light.
Watch Warsh’s first meeting: the IPO heat versus a locked-in rate hike is the tug of war, and whatever the new chair signals on Tuesday and Wednesday decides which side wins the rest of June.
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About the Author
Daniel Yue has been an active investor since 1980, with experience spanning stocks, currencies, futures, metals, and bonds. A scholar of the Chicago School of Economics, he holds a Certificate with Distinction from Cambridge University and a degree in International Trading from National Taiwan University. He served as Chief Analyst for over 30 years and Chief Mentor at Sincere Finance. In 2017, he received an award from the University of Arizona for financial internship leadership.
The analysis and opinions expressed in this article are for educational purposes only and do not constitute financial advice. Investing involves risk. Please consult a qualified financial advisor before making investment decisions.
About the Author
Daniel Yue has been an active investor since 1980, with experience spanning stocks, currencies, futures, metals, and bonds. A scholar of the Chicago School of Economics, he holds a Certificate with Distinction from Cambridge University and a degree in International Trading from National Taiwan University. He served as Chief Analyst for over 30 years and Chief Mentor at Sincere Finance. In 2017, he received an award from the University of Arizona for financial internship leadership.
The analysis and opinions expressed in this article are for educational purposes only and do not constitute financial advice. Investing involves risk. Please consult a qualified financial advisor before making investment decisions.