Key Takeaways
- SpaceX (SPCX) shares fell another 4.59% to $153.05, extending a 30% retreat from June highs as investors brace for a massive $800 billion lockup expiration.
- NATO partners finalized $50 billion in new defense contracts at a summit in Ankara, focusing on drone technology, amphibious ships, and air defense systems.
- Canada’s Ivey PMI dropped to a three-month low of 56.2 in June, missing estimates of 59.1 and signaling a cooling in the pace of economic expansion.
- Two tankers were struck by projectiles in the Strait of Hormuz, causing minor structural damage but no casualties, as regional tensions escalate following the death of Iran's Supreme Leader.
SpaceX Volatility Intensifies Post-IPO
SpaceX (SPCX) stock continued its downward trajectory on Tuesday, falling 4.59% to close at $153.05. The decline comes as the "quiet period" for underwriters ended, leading to a wave of mixed analyst initiations. While Goldman Sachs (GS) and Morgan Stanley (MS) issued bullish price targets of $205 and $300 respectively, others like MoffettNathanson initiated with a "neutral" rating and a $131 target, citing the company's complex valuation.
Investor anxiety is being driven by an impending $800 billion lockup expiration. Former Nasdaq CEO Robert Greifeld warned that the sheer volume of insider shares becoming tradeable by October is "unprecedented" in U.S. capital markets history. Although the company has structured the release in staggered tranches to mitigate a sudden flood of supply, the market remains wary of price-insensitive selling from early backers sitting on 20x returns.
NATO Secures $50 Billion Defense Package
At the NATO summit in Ankara, alliance members signed procurement deals valued at a minimum of $50 billion. The agreements are part of a broader shift toward a 5% GDP defense spending target. Key contracts include a €35 billion investment in drone warfare technology and a joint €2.5 billion order for amphibious transport ships by the Netherlands and the UK.
The summit also addressed the replacement of aging AWACS radar aircraft and the localized production of Stinger missiles in Germany. NATO Secretary-General Mark Rutte emphasized that these contracts are designed to "deter and defend" while scaling up transatlantic manufacturing capacity. The move highlights a concerted effort to modernize the alliance's "crucial kit" amid shifting global security threats.
Canadian Economic Activity Slows
The Ivey Purchasing Managers Index (PMI) for Canada fell to a seasonally adjusted 56.2 in June, down from 58.2 in May. This figure came in significantly below the consensus estimate of 59.1, marking the lowest level of activity since March. Despite the dip, the reading remains above the 50.0 threshold, indicating that the Canadian economy is still expanding, albeit at a decelerating rate.
Internal metrics of the report showed a decline in the employment gauge to 53.6 and a cooling of the prices index to 73.7. Analysts suggest that the combination of falling employment and price measures may provide the Bank of Canada with more room for maneuver regarding interest rate policy. The Canadian Dollar (CAD) saw moderate pressure following the release as traders adjusted growth expectations.
Maritime Attacks in the Strait of Hormuz
The United Kingdom Maritime Trade Operations (UKMTO) reported two separate incidents involving tankers in the Strait of Hormuz on Tuesday. In the most recent attack, a tanker was hit by an unidentified drone, suffering minor structural damage. The vessel was able to continue its journey to the next port, and no casualties or environmental damage were reported.
These incidents follow a period of heightened tension in the region after the death of Iran's Supreme Leader. Iranian state media suggested that at least one vessel was targeted after allegedly ignoring warnings. The attacks have raised concerns over the stability of global energy supply routes, as the Strait of Hormuz remains a critical channelling point for a fifth of the world's traded oil and natural gas.
Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications.