The mega IPOs of SpaceX, Anthropic and OpenAI alone can't fix this stock market
Why it matters: The lack of sufficient capital for mega IPOs and rising oil prices could lead to earnings-per-share losses in the S&P 500.
- SpaceX is projected to be a $2 trillion company, while OpenAI is valued at $830 billion and Anthropic at $380 billion, with these valuations set by institutions despite a lack of clear profit plans.
- OpenAI's valuation surged from $500 billion to $830 billion in weeks, driven solely by user growth without significant operational changes.
- WTI crude for May delivery rose 11.4% on Thursday, marking a nearly 12% increase over four days and its sixth positive week out of seven, indicating inflationary pressure.
- President Donald Trump's statements about the Middle East war ending in "two to four weeks" are perceived as influencing market reluctance to sell, despite the ongoing conflict's negative impact on the market.
The stock market faces a significant challenge with the impending mega IPOs of SpaceX, Anthropic, and OpenAI, valued at $2 trillion, $380 billion, and $830 billion respectively, as there isn't enough capital inflow to support these valuations, which are currently set by institutions without clear profitability plans. This issue is compounded by rising oil prices, with WTI crude for May delivery jumping 11.4% on Thursday and nearly 12% over four days, driven by ongoing geopolitical tensions in the Middle East, which historically suppress market growth.
