Going Public
Preview of the Week Ahead, Stocks to Watch, A brief history of major IPOs, SPY pivots + more
Good Morning Substack,
The stock market sold off heavily on Friday, with both the S&P 500 and the Nasdaq posting their worst day of trading in 2026.
Why did we sell?
Likely a combination of many things, the first being the war in Iran. Iran has begun attacking Israel again after the fragile truce has once again fallen through.
The second reason was likely due to the strong job numbers.
On Friday, President Trump expressed confusion about the Job market’s strong numbers and their sudden inverse correlation with stocks.
However, the strong job numbers seemed to signal to Wall Street that interest rates will remain higher for longer than they originally anticipated. The probability of another rate hike before the end of 2026 jumped to 55%
Global Selling
Circuit Breaker triggers in the South Korean stock market.
The Upcoming IPO Craze - 3 New T’s
3 of the most anticipated IPOs ever are expected to debut in the stock market in 2026.
SPCX -SpaceX (Nearly 3x larger than the previous largest IPO, Saudi Aramco) Expected to raise 75 billion with an initial evaluation around $1.77 Trillion
Reuters initially reported that up to 30% of SPCX stock would be reserved for retail traders
This number is much higher than typical IPOs, which typically allocate only 5-10% of their IPO for retail investors
Anthropic
Open AI
The valuation of both of these AI models is expected to be around $1 trillion - only 14 other companies worldwide are valued at $1T or above
How will the markets react.. historically speaking?
When looking back at the history of the largest IPO debuts there is a range of impact it can have on the stock market depending on variables throughout the market.
New IPO(s) cause peak Euphoria
A mega-IPO debuts towards the end of a bull market, it has the potential to act as a liquidity sponge
Historically, this was seen during the late 90’s tech boom and briefly during the 2020 SPAC craze
Should valuations peak around the time of a major IPO, and bullish momentum could be exhausted on the new listing, while also disappearing from the broader markets
The IPO Isolated Outlier
Any of the upcoming IPOs could be so big that they react and trade in their own manner, decoupled from a healthy stock market
Historically, a great example of this scenario was META back in 2012 - the initial valuation was pushed too high, and Wall St refused to inherit the premium during the first months of META’s IPO.
META saw trading glitches, large volume and skepticism over mobile monetization causing the stock to underperform for months after its initial debut.
The Defensive Cash Haven
IPO’s that debut during downtrends or bear markets can sometimes offer safety should the business model be built on essential infrastructure or reliable transactional volume
Historically, this was seen in V 0.00%↑ VISA during the 2008 financial crisis
Historically, valuations are high and should any of these IPO’s attempt to act as a safe haven and it would only worsen the AI bubble hype. There is a real risk for the market to suffer when these IPO’s debut. Based off history and where the market currently is, I’d expect the outcome to be one of the first two options.
