SpaceX IPO plunge wipes $800 bn in market value as shares dip below issue price

Elon Musk’s SpaceX completed the largest IPO in history, initially valued at about $1.77 trillion and briefly trading above its $135 issue price. Within weeks the share price fell back below that level, erasing more than $800 billion of market capitalization.

The sharp decline benefitted short sellers, whose positions on the stock rose from roughly $4.5 billion to $25 billion in nominal value, generating billions of paper profits. Analysts attribute the volatility to the company’s forced inclusion in the Nasdaq‑100 and the resulting automatic buying by ETFs, which distort price signals. Some commentators, such as former Fidelity manager George Noble, argue the stock is vastly over‑valued, while others maintain bullish outlooks. Musk’s 42 % stake means his personal wealth slipped from a brief trillion‑dollar peak to about $861 billion as the shares dropped.