AI Summary
5 min readSpaceX Stock Crashes $1T & AI Trade Reverses!
Just weeks after the biggest IPO on record, SpaceX shares have fallen below their listing price for the first time — down 40% from an intraday high of $225 to close Friday at $123.99. The sell-off has wiped roughly a trillion dollars in market value from the company's peak, and short sellers have booked about $4 billion in paper profits in the past month alone.
The SpaceX Sell-Off in Detail
SpaceX went public in mid-June, raising $86 billion at a valuation of almost $2 trillion. Wall Street investment banks set price targets that struck some observers as extraordinary — one reportedly as high as $700 or more. But the stock has since slipped below its initial listing price of $135, and the decline has accelerated. On Friday, shares fell more than 5% to close at a fresh low.
The short interest is striking. About 30% of the roughly 640 million SpaceX shares available to trade have been borrowed to sell short — up 10 percentage points over the past 10 days, according to S3 Partners data cited by the Financial Times. The managing director of SLC Management said the company's equities and bonds are "suddenly pricing in more risk."
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What you'll learn
- 1 (00:02) **SpaceX Stock Crashes $1T** - SpaceX shares have dropped 40% from their post-IPO high, losing roughly $1 trillion in market value in a month, with heavy short-selling activity.
- 2 (05:18) **AI Trade Reverses & Semiconductors Sell Off** - The broader AI-driven tech rally is reversing, with US semiconductor stocks experiencing their worst week since last year's "Liberation Day" market rout.
- 3 (07:48) **Korea's AI-Led Market Meltdown** - South Korea's stock market, the world's best performer over two years, is now in a severe bear market, driven by leveraged bets on AI-related stocks.
- 4 (11:08) **What to Watch Next: Capex and the AI Bubble** - The host flags capital expenditure (capex) from the "Mag 7" as a key indicator; the first company to cut AI spending could trigger a broader unwind.
- 5 Standout Quotes
- 6 "With more shares coming to market in August, SpaceX could announce that they've conquered the moon and found gold inside it and there still wouldn't be enough money out there to buy the stock." – Chief Investment Officer of a small North American Hedge Fund.
- 7 "This isn't a story about meme stocks or worthless companies. Samsung Electronics and SK Hynix... are enormously profitable businesses at the center of the global AI boom, and the traders buying them were right about the trend." – Patrick Boyle, finance professor.
+ Full timestamped outline available in the app
Show Notes
John Johnston (JJ) breaks down how SpaceX stock lost around $1 trillion in market value from its initial peak, and short sellers are increasingly betting against SpaceX, just weeks after its massive IPO. Also, we look at how this relates to US semiconductor stocks falling at the same time, and in turn how this relates to the huge volatility in the South Korean KOSPI Index over the past year, and its recent fall into bear market territory.
Related episodes:
SpaceX Stock is Crashing & Tesla Investors Want Answers https://open.spotify.com/episode/2Jey6dAGdZeZNXvAk6DGj7
Aswath Damodaran: “SpaceX Looks AWFUL As An Investment” https://open.spotify.com/episode/5lheHMH1AuJ1YVYB3i3F8G
Referenced video:
The World’s Best Stock Market Is Also Crashing! | Patrick Boyle On Finance https://open.spotify.com/episode/1NyAd8NTavmMG1LmlLWMIC
Disclaimer: I am not a financial adviser and nothing in this content is financial advice. This content is for general education and entertainment purposes only. Do your own analysis and seek professional financial advice before making any investment decision.
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