Global initial public offering (IPO) markets are hunkering down ahead of SpaceX’s US$75 billion flotation, as billionaire Elon Musk’s commercial aerospace unit is set to siphon off capital and tighten liquidity amid rising expectations that the Federal Reserve will raise interest rates to curb inflation.
With investor demand expected to be overwhelming, the offering on Wall Street could be the world’s biggest-ever, exceeding Saudi Aramco’s US$29.4 billion in 2019. SpaceX’s IPO would already be more than twice as large as the combined US$37.2 billion of IPOs sold in Hong Kong in 2025. The city was ranked the biggest IPO market in the world last year.
“Liquidity conditions may become unfavourable for IPO markets, including Hong Kong,” said Wang Zheng, chief investment officer at Jingxi Investment Management in Shanghai. “Lots of investors will have their eyes on the SpaceX IPO and that may cause some outflows from the markets across emerging nations and the Asia-Pacific region in preparation for subscriptions.”
The repercussions of SpaceX’s blockbuster offering could be far-reaching and reshape the financial market landscape. Given that the commercial aerospace company has chosen to list on the Nasdaq, Hong Kong was poised to lose its title as the world’s busiest IPO market to the US this year. The deal may also test liquidity levels that broadly supported elevated global tech stock valuations, especially with persistent oil shocks having fuelled expectations of a resurgence in inflation.
Tech stocks in Asia might already be feeling the pain. The Hang Seng Tech Index fell more than 2 per cent on Thursday and China’s Star Market 50 Index tumbled nearly 4 per cent, partly reflecting the effects of being squeezed out by the SpaceX IPO. In the US, the record-setting run also lost momentum, with key stock gauges moving sideways amid the likelihood that some investors may have unwound their positions in existing shares ahead of the SpaceX IPO.
That added to liquidity concerns among investors after the yield on the 30-year US Treasury exceeded 5 per cent, as rising energy costs fed into the economy following the outbreak of the US-Israel war on Iran at the end of February.
“SpaceX, like the AI leaders, is asking investors to fund a capital-intensive platform on the promise of future infrastructure dominance,” said Gary Dugan, CEO of The Global CIO Office. “That story works best when capital is cheap and investors are willing to look through near-term execution risk. Rising bond yields make that harder.”
The SpaceX offering will add to the US$10.7 billion of IPOs on the US market so far in 2026, where 32 companies conducted first-time stock sales, according to Bloomberg data. The largest was the US$2.03 billion flotation of asset-management firm Pershing Square. In Hong Kong, 54 companies have raked in a combined US$20.2 billion from IPOs this year, with the US$2.95 billion sales of printed circuit board maker Victory Giant Technology ranking as the most valuable.
The offering would value SpaceX at more than US$2 trillion. The rocket, satellite and artificial intelligence giant posted a net loss of $4.28 billion in the first quarter, widening from a loss of US$528 million a year ago.
SpaceX’s coming IPO would be scrutinised by investors as closely as the broader AI trade, where buying was more selective and focused on those companies with the prospects of generating cash and returns from massive investments, according to Dugan at The Global CIO Office.
“The question is not whether SpaceX is strategically important,” he said. “It is whether markets will continue paying premium valuations for projects where the payoff is large but distant.” -- SOUTH CHINA MORNING POST
