SpaceX trading losses on Tuesday didn’t appear to have much to do with space fundamentals. Instead, technical factors created volatility.
Elon Musk’s AI and space company entered the Nasdaq-100, one of the best-known large-cap growth indexes that tracks the largest nonfinancial companies listed on Nasdaq. It’s a who’s who of tech giants, including Apple, Nvidia, Alphabet, Amazon.com, Meta Platforms, Broadcom, Micron Technology, and others. The total market value of companies in the 100 is almost $40 trillion at recent prices.
A stock pop was possible, as passive funds snap up shares. But investors should always remember the stock market is forward-looking.
Being fast-tracked into the index reflects just how important privately held frontier AI companies, including OpenAI, Anthropic, and SpaceX before its June IPO, have become to the entire stock market. There aren’t that many trillion- or near-trillion-dollar companies. Up until recently, three were privately held. Anthropic and OpenAI are expected to raise money in IPOs later this year. They will also receive the SpaceX treatment.
Early inclusion in the indexes can lead to stock volatility—and even a stock pop—as passive players buy a limited supply of shares. SpaceX raised a record-breaking $86 billion; that was a fraction of its $1.8 trillion IPO valuation.
Of course, index providers know this. The Nasdaq is adding SpaceX to the Nasdaq-100 at a float-adjusted weight. There are only about 638 million shares available for trading, worth about $102 billion at current prices. Nasdaq is multiplying that by three, giving SpaceX the impact of a $300 billion market-cap company.
That’s about 0.75% of the Nasdaq-100 market value. Given that roughly $800 billion is indexed to the Nasdaq-100, passive funds will need to buy about $6 billion in SpaceX stock, according to Barron’s math.
That’s about 6% of the total SpaceX shares available for trading. That could have created a supply/demand imbalance, leading to a pop, but the addition was manageable. What’s more, traders have already been amassing stakes, ready to sell to index funds.
Through Monday trading, SpaceX shares are up roughly 10% from recent lows. That might have already reflected the indexation bump.
SpaceX stock lost 6.8% on Tuesday, closing at $149.47, while the S&P 500 dipped 0.5%. Since the IPO, shares have traded as high as $225.64 and as low as $147.11.
That Tuesday drop came despite a bevy of new ratings from Wall Street analysts. Most of which were positive. SpaceX stock picked up 14 new calls to Buy. That didn’t stop the selling, though.
To be sure, more stock will become available soon. Some 20% of shares become available for trading after the company’s first earnings report, due in a couple of weeks. That can ease indexation pressures. Investors will be dealing with supply-and-demand issues for a few months, as they do with most IPOs.
Of course, eventually SpaceX’s sales and earnings will determine where the stock trades. SpaceX is expected to grow sales rapidly. Sales in 2026 are expected to be about $36 billion, almost double that of 2025. By 2030, Wall Street projects $200 billion in sales. SpaceX’s AI and Starlink communications business will drive that growth.
Those businesses are what investors will pay attention to—eventually.
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