On its first day of trading, SpaceX attracted $117 million in retail net buying, representing a significant 56% of all retail purchases in the equities market, according to Vanda Research. This enthusiasm for SpaceX, which accounted for 20% of the $75 billion IPO, contrasts sharply with the overall decline in retail single-stock activity, which reached its lowest level since March 2020.
Analysts are noting a concentrated interest in top-tier tech companies, leading to the rebranding of the previously known 'Magnificent Seven' to include SpaceX, OpenAI, and Anthropic, forming what is now referred to as the 'FAB 10.' This shift indicates a growing focus on companies that are expected to shape the future of AI and technology.
Notably, SpaceX's trading volume was significantly higher than that of other popular stocks, such as Nvidia. However, the popularity of SpaceX may be diverting funds away from previously favored sectors, like semiconductor stocks, which are now seen as less appealing to retail investors.
Despite the high retail allocation, institutional investors still dominate the market, with SpaceX reducing its retail allocation from 30% to 20% due to strong demand from larger investors.
The performance of these new tech entrants will be closely monitored, as any failure to meet expectations could lead to a broader reassessment of tech sector valuations, which some analysts already view as inflated