The unprecedented scale of upcoming initial public offerings (IPOs) from SpaceX, Anthropic, and OpenAI could mean near-term turbulence for the US stock market, says Steve Brice, global chief investment officer of wealth solutions at Standard Chartered.
Why? Because these mega-cap market debuts will likely present “digestion challenges,” he argued in a recent CNBC interview, adding this aggressive influx of new stocks could drain “institutional liquidity” and weigh heavily on broader indices.
Consequently, Standard Chartered maintains a cautious stance heading into the summer, especially since the capital drain coincides with severe geopolitical supply shocks tied to the US-Iran conflict.
Why SpaceX, Anthropic, OpenAI IPOs will trigger a sell-off
According to Steve Brice, the sheer financial gravity of these tech and aerospace listings amounts to a significant call on institutional capital.
SpaceX is targeting a record $1.8 trillion IPO valuation, following a 33% year-over-year increase in revenue to $18.7 billion last year.
Meanwhile, Anthropic has reportedly hit a $965 billion valuation in the private market on a $47 billion revenue run-rate, leapfrogging OpenAI’s $852 billion valuation as of its latest funding round.
Bringing this $3.5 trillion in combined equity to the public markets would almost certainly require significant institutional recalibration.
And while market broadening is expected, it’s unlikely to proceed in a “totally smooth fashion,” Brice noted.
He expects portfolio managers to liquidate existing holdings to secure capital for these generation-defining assets, triggering broader market weakness during the initial phase of the summer listing cycle.
Geopolitical tensions could exacerbate the liquidity drain
Compounding the liquidity strain are ongoing “geopolitical tensions” that threaten global supply chains.
While robust upcoming US labour data may temporarily anchor investor sentiment, Brice believes this resilience could rapidly deteriorate if the Strait of Hormuz remains shuttered.
Tehran’s closure of the critical maritime chokepoint in “retaliation” for the Trump administration’s blockade of Iranian ports has already triggered a sharp escalation in global energy prices.
“Inventories are being run down at a rapid pace,” Brice explained, extending beyond physical crude to essential industrial inputs like petrochemicals and urea.
This aggressive contraction in supply-side inputs threatens to compress corporate operating margins globally, exacerbating the broader weakness Standard Chartered anticipates as the aforementioned mega-IPOs launch into an increasingly fragile environment.
What investors should do once the sell-off materializes
Despite these immediate headwinds posed by liquidity drain and supply-chain blockades, Standard Chartered views the anticipated summer pullback as a tactical entry point.
Over the longer term, the weakness from SpaceX, Anthropic, OpenAI offerings and energy market turbulence will transform into a “good buying opportunity” at some point later this year, Brice added.
In short, once the initial capital rotation subsides and supply chain shocks are priced in, disciplined capital deployment should reward investors as the market fully digests these historic listings.
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