Key Takeaways:
SpaceX (NASDAQ:SPCX) shares plunged 10% to about $158 on Thursday, June 19, extending a two-day decline to 14% as the post-IPO euphoria gave way to profit-taking and macro headwinds from the Federal Reserve's rate hold.
The drop pushed SPCX below its $160.95 IPO opening price for the first time since its June 12 debut, erasing most of the gains from a three-day winning streak that had briefly lifted the company's market capitalization past Amazon and Microsoft. SpaceX's market cap now sits at roughly $1.22 trillion, down from a peak above $2 trillion reached during Tuesday's session.
"The speed of the post-IPO rally was unsustainable, and the Fed's hawkish hold gave momentum traders a reason to take profits," said Tom Brennan, equity analyst at Edgen. "A 14% pullback after a 50% surge in four days is textbook profit-taking, not a structural breakdown."
The selloff accelerated after the Federal Reserve left interest rates unchanged on Wednesday, with Chair Kevin Warsh's press conference weighing on growth-stock sentiment. The broader tech-heavy Nasdaq Composite fell 1.3% on Wednesday, while the S&P 500 dropped 1.2%. The U.S. 10-year Treasury yield edged higher by 3 basis points to 4.38%, adding pressure on high-multiple names like SpaceX. The U.S. Dollar Index held near 104.5, while Brent crude fell 1.6% to $78.30 a barrel, reflecting broader risk-off positioning across asset classes.
Sector rotation was evident as capital flowed out of momentum names. The S&P 500 information technology sector fell 1.8%, the worst performer among the 11 GICS groups, while utilities and consumer staples — defensive sectors — gained 0.6% and 0.4%, respectively. The Cboe Volatility Index rose 1.2 points to 18.7, reflecting increased hedging demand.
Retail enthusiasm, which had defined SPCX's debut as the most-bought stock by individual investors for three consecutive sessions per Vanda Research, showed signs of cooling. Reddit's WallStreetBets forum shifted from bullish posts to skeptical threads about institutional selling and upcoming lock-up expirations. A composite prediction-market and social-sentiment score for SPCX stood at 37, leaning bearish.
Even as the stock declined, the bull case gained institutional representation. Arete initiated coverage of SpaceX with a Buy rating and a Street-high $401 price target, arguing the company is "breaking hard engineering challenges into stepwise tasks" across space, connectivity, and artificial intelligence. The consensus analyst target sits at $164, implying the stock is roughly in line with average expectations at current levels.
The next catalyst for SpaceX is its first quarterly earnings report as a public company, expected in early to mid-August. That report will trigger the first tranche of early investor lock-up expirations — up to 30% of Early Release Eligible Shares could become tradable if the stock stays above $175.50, a level it has already fallen below. The 70-day lock-up mark falls on Aug. 21, when an additional 7% tranche becomes eligible for sale, potentially adding further supply pressure.
This article is for informational purposes only and does not constitute investment advice.
