U.S. stock futures rose Friday as two major catalysts converged: the debut of SpaceX on the Nasdaq $NDAQ and reports that the U.S. and Iran are close to an agreement that would reopen the Strait of Hormuz.
The rocket maker's $75 billion offering — the largest IPO in history — hits the Nasdaq as oil prices fall on reports of a U.S.-Iran agreement
Brandon Bell/Getty Images
U.S. stock futures rose Friday as two major catalysts converged: the debut of SpaceX on the Nasdaq $NDAQ and reports that the U.S. and Iran are close to an agreement that would reopen the Strait of Hormuz.
Among index futures, the Dow Jones Industrial Average contract climbed 363 points, or 0.7%, with S&P 500 and Nasdaq-100 contracts each posting gains of roughly 0.6%. Overseas, equities broadly advanced, including a 1.7% rise in Europe's Stoxx 600, a 2.8% surge in Japan's Nikkei 225, and a 4.6% jump in South Korea's Kospi.
According to Iranian state media, a proposed U.S.-Iran memorandum of understanding would have Washington lift oil sanctions while Tehran agrees to reopen the Strait of Hormuz. Oil prices fell to their lowest level since the early days of the Iran war on the reports.
Priced at $135 a share with 555.6 million shares on offer, the SpaceX debut is designed to generate $75 billion in proceeds for the rocket company. For context, Alibaba's 2014 U.S. offering — the previous record holder at $22 billion — would need to be multiplied more than three times over to match SpaceX's raise. The company will trade under the ticker symbol SPCX. At the offering price, SpaceX carries a valuation of $1.77 trillion.
Revenue at the company leans heavily on its satellite internet division, with an early-stage artificial-intelligence operation rounding out its business lines.
Thursday's session saw stocks climb as semiconductors bounced back and President Donald Trump indicated a resolution to the Iran conflict could be imminent, setting up Friday's positive tone. That rally pushed the S&P 500 and Nasdaq Composite into positive territory for the week.
Not everyone is bullish on the market impact of the debut. Douglas Beath, a global equity strategist at Wells Fargo $WFC Investment Institute, warned in a note to CNBC that the offering's scale carries risks for the broader market. "History indicates that large IPO issuance occurs during periods of strong equity market sentiment, but the added equity supply can cause some indigestion," he wrote. "Household equity exposure already sits close to an all-time high, which suggests they may sell existing holdings to fund these new positions."
Join 500,000+ readers who start their day with Quartz.
By subscribing, you agree to our Terms of Service and Privacy Policy.