It’s SpaceX () day. It appears that it was heavily oversubscribed by retail accounts, with investors getting as little as 20% of their orders. There are plenty of analysts who have characterized the shares as very overpriced at over 90X sales, but the chance to buy at the IPO price was a unique opportunity for most investors.
The apparent resolution with Iran brought a major relief rally yesterday. with the major indexes popping +1.75%, the NASDAQ +2.5%, the 3%. Nothing has been signed yet, but the oil markets certainly indicate that the Strait of Hormuz is expected to be open shortly.
It’s of note that the U.S. Treasury market is seeing yields on the rise today, roughly 3bps across the yield curve. This is still below the level yields were at before the news of an apparent peace deal with Iran, and perhaps a reaction to the growing uncertainty that a workable deal is really going to be signed shortly. Energy stocks were down 3.3% yesterday and are up 1.6% this morning.
We’re seeing above-average volatility today, with the NASDAQ swinging from losses to gains twice in the first 90 minutes of trading. We just got news that the Iranian Foreign Minister was quoted as saying an agreement has never been closer, taking the market higher and taking crude down +3% and interest rates lower.
The Iran settlement rally is far from over. The even-weighted just hit a new all-time high. SpaceX has yet to open to trade. If a workable Iran agreement is reached and SpaceX goes well, the road to new highs is paved.
The trend has moved to guardedly optimistic.