SpaceX finished its first day of public trading last Friday at $160.95, fixing its market capitalization at $2.1 trillion. The company still set a record for the largest IPO in U.S. stock market history, but the closing performance did not fully satisfy the expectations built up before the listing. Research firm CFRA even assigned SPCX a “sell” rating, adding to the debate over whether Elon Musk’s Mars narrative was enough to support the valuation that investors had priced in ahead of the debut.
SPCX closed Monday at its intraday high
On Monday, however, SPCX reversed much of that hesitation with a sharp rally after the U.S. market opened. According to Gate U.S. stock market data, SPCX climbed throughout the session and closed at $192.5, up 19.6%. The closing price was also the day’s high. At that level, SpaceX’s market value rose to $2.519 trillion, making it the eighth-largest company in the world by market capitalization. Hyperliquid data showed that SPCX had already traded above $214 in pre-market pricing. Based on that move, the original report judged that SPCX had a high probability of extending Monday’s gains after the Tuesday open and overtaking Amazon, which ranked seventh by market capitalization.
The broader macro backdrop also strengthened risk appetite in U.S. equities. This week, the United States and Iran reached a memorandum of understanding, which was described as an important positive development for the U.S. stock market. With geopolitical tensions stabilizing in the market narrative, expectations for a new round of gains across global equities increased, and SpaceX was counted among the beneficiaries of that shift.
U.S.-Iran agreement lifted the broader equity market
On June 15, Donald Trump announced that an agreement with Iran had been reached and that the Strait of Hormuz would be opened. Unlike several earlier episodes of one-sided public rhetoric, this agreement was also acknowledged by Iran. Iranian Deputy Foreign Minister Gharibabadi said on the same day that the text of the U.S.-Iran memorandum of understanding had been finalized and would be formally signed in Switzerland on Friday, June 19.
The agreement was then confirmed again by the Iranian president. U.S. Vice President Vance also said that the deal reached between the United States and Iran had been signed electronically over the weekend, indicating that the terms had already taken effect. The report described the room for either side to tear up the agreement again as limited. After the news spread through the market, U.S. equities rose broadly at the open: the Dow Jones Industrial Average closed up 0.92%, the S&P 500 gained 1.65%, and the Nasdaq Composite rose 3.07%.
Morgan Stanley said the long-term agreement between the United States and Iran, together with a pullback in oil prices, would ease inflation pressure. The bank also argued that U.S. equities were moving away from a narrow, single-leader market and toward a healthier, broader advance. In its view, the upward momentum in U.S. stocks was no longer confined to the technology sector and was gradually spreading into a wider range of cyclical industries.
Retail money concentrated in SpaceX
From the perspective of trading sentiment, SpaceX remained the stock most aggressively pursued by retail investors. According to Vanda Track data, on June 16 U.S. local time, SpaceX received about $93.8 million in net retail buying in a single day. That represented roughly 73% of all retail net inflows into individual U.S. stocks that day. In practical terms, for every $4 of incremental retail capital entering the U.S. equity market, around $3 flowed into SpaceX.
Against that level of demand for SPCX, SpaceX’s underwriters exercised the over-allotment option in the IPO, known as the greenshoe mechanism. They purchased an additional 83.33 million shares, bringing the total IPO share issuance to 638,888,888 shares of Class A common stock. The move increased the total size of the offering to $85.7 billion. The report said that this scale exceeded the over-allotment arrangements of almost every technology company IPO on record.
Even so, reports indicated that most eligible U.S. retail investors received only about one share in the SpaceX IPO allocation. With an extremely limited free float and a large imbalance between supply and demand, concentrated retail buying was enough to lift the share price significantly. This supply structure became one of the central explanations for why SPCX was able to move so sharply after a first-day close that had left some investors unconvinced.
Options, gamma squeeze debate, and institutional views
On June 16, influential U.S. financial media outlet zerohedge wrote that after SPCX options begin trading, the stock price could rise to $400 through a gamma squeeze and surpass Nvidia. A gamma squeeze is an upward spiral triggered when options market makers are forced to buy the underlying stock as prices rise. SpaceX has a very low free float of 4.2%, while retail buying interest is extremely high. Retail investors who have not obtained SPCX common shares may instead turn to relatively cheaper call options. If large amounts of capital rush into call contracts, market makers must buy SPCX spot shares to hedge their exposure, pushing the stock higher and creating a positive feedback loop. The 2021 surge in GameStop (GME) was cited as one of the classic examples of this mechanism.
Institutional and investor commentary also continued to shape the discussion. Before the U.S. market opened on June 15, Oppenheimer analyst Timothy Horan initiated coverage of SpaceX with an “outperform” rating and set a short-term price target of $190. After the market opened on Monday, SPCX closed at $192.5, roughly in line with Oppenheimer’s target.
On June 14, well-known entrepreneur, XPRIZE founder, and early SpaceX investor Peter H. Diamandis wrote that SpaceX is a “railroad in orbit.” He said it would open the path to a multi-planet human civilization and create enormous wealth in the same way that 19th-century railroads opened the American West. Diamandis also predicted that SpaceX and Tesla would merge within the next year and become the first $100 trillion company.
Diamandis added that over the past decade, whenever he released capital from other transactions, he invested that money into Bitcoin. Now, he said, whenever he has idle funds, he invests in SpaceX. He acknowledged that the share price would fall when locked-up shareholders are allowed to sell and when some shareholders cash out, but said his own investment in SpaceX was not aimed at quarterly stock appreciation. Instead, he framed it as a way to support the development of an off-Earth economy. On June 16, well-known Silicon Valley investor Brad Gerstner described SpaceX on the latest episode of the BG2 podcast as a must-buy-and-hold asset for institutional investors, arguing that the company sits at the intersection of the space economy and the expansion of artificial intelligence computing power.