In recent days, retail trading capital has been almost entirely absorbed by SpaceX.
Data from Vanda Research shows that over the first three trading days following its listing, the net inflow of retail funds into SpaceX exceeded the total amount retail investors spent buying all of the "Magnificent Seven" U.S. tech stocks.
SpaceX's stock price surged dramatically after its initial public offering, quickly becoming the singular focus for many retail investors. As of Wednesday's close, the SpaceX share price had risen over 42% from its $135 IPO price, and its market capitalization briefly surpassed that of Microsoft and Amazon.com during Tuesday's session.
Retail Frenzy Over SpaceX
The highly anticipated space exploration company SpaceX completed its listing on the Nasdaq exchange on June 12, local time. Investors flocked to participate in the world's largest IPO, betting on Elon Musk's expansive commercial empire spanning rocket launches, internet services, and artificial intelligence. Data indicates SpaceX attracted over $100 billion in retail subscription demand, surpassing its $75 billion fundraising target.
In recent years, the "Magnificent Seven" tech giants—Alphabet (Google's parent), Amazon.com, Apple, Microsoft, Meta Platforms, Inc., NVIDIA, and Tesla Motors—have been core trading targets for retail investors. Just a week before SpaceX's listing, NVIDIA was still firmly at the top of the list for net retail purchases.
However, the market landscape changed completely after SpaceX went public. Vanda Research data shows that in the three trading days post-listing, U.S. retail investors net purchased $369.8 million worth of SpaceX stock. In contrast, retail investors net purchased only $88.2 million of NVIDIA stock during the same period.
Even when combining the retail purchase amounts for all seven tech giants with those of two popular broad-based ETFs—the SPDR S&P 500 ETF (SPY) and the Invesco QQQ Trust—the total sum only roughly matched the flow into SpaceX. "Over the past three trading days, retail buying of SpaceX has been roughly equal to the combined buying of NVIDIA, Alphabet, Amazon.com, Microsoft, Meta Platforms, Inc., QQQ, and SPY. Notably, this count excludes Tesla Motors and Apple, which were both net sold by retail over the period," Vanda Research wrote in its report.
Given the current overall caution among retail investors towards the U.S. stock market, the frenzy for SpaceX appears particularly exceptional. Vanda data indicates that even with the incremental boost from SpaceX's listing, the weekly net retail purchase amount for U.S. individual stocks last week still hit its lowest level since March 2020. "The SpaceX rally has not triggered a broad market upswing; retail inflows into other AI-related stocks have fallen far short of market expectations. Capital is currently highly concentrated in this single stock, with almost no spillover effect," Vanda Research stated.
Korean 'Seohak Ants' Swarm In
Additionally, Korean investors have drawn significant attention. On the first day of SpaceX's stock trading, Korean overseas retail investors, known as "seohak ants," snapped up nearly $800 million worth of SpaceX shares. According to data from Korea Securities Depository, Korean retail investors net purchased $796 million worth of shares in a single day, making this rocket and AI company the most popular U.S. stock among South Korea's over 14 million retail investors. Data shows this one-day net purchase total exceeded the cumulative net purchase amount for any other U.S. stock over the past three months.
Korean interest in SpaceX was evident even before its listing. Data shows that over the past month, Korean investors net purchased $316.54 million in the TEMA Space Innovators ETF, which includes SpaceX-related stocks.
Amidst a broader market downturn and profit-taking, SpaceX's stock pulled back on Wednesday, closing down 4.95% at $191.82, marking its first negative close since listing.
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