Weak Performance Trends in Hong Kong IPO Market
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 59 minutes ago
0mins
Source: CNBC
- IPO Market Leader: According to KPMG, Hong Kong led the world in IPO funds raised in 2024, surpassing the New York Stock Exchange and Nasdaq, indicating strong market appeal.
- Post-Listing Underperformance: Of the 179 companies listed since January 2025, about half have seen their stock prices decline over the past three months, reflecting a broader trend of weak performance in Hong Kong IPOs compared to the mild drop in the Hang Seng Index.
- Capital Flow Trends: Following the inclusion of certain Hong Kong-listed stocks in the Stock Connect program, capital tends to flow to cheaper A shares, resulting in significant price volatility for these stocks, with some like Deepexi dropping over 51% post-IPO.
- Increased Market Pressure: Goldman Sachs predicts that Hong Kong will raise about $60 billion in IPOs in 2025, nearly double the amount raised in 2024, but low fees and intensifying competition are putting pressure on the financial market's short-term performance.
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Analyst Views on NDAQ
Wall Street analysts forecast NDAQ stock price to rise
10 Analyst Rating
9 Buy
1 Hold
0 Sell
Strong Buy
Current: 88.450
Low
101.00
Averages
111.50
High
123.00
Current: 88.450
Low
101.00
Averages
111.50
High
123.00
About NDAQ
Nasdaq, Inc. is a global technology company serving corporate clients, investment managers, banks, brokers, and exchange operators as they navigate and interact with the global capital markets and the broader financial system. The Company manages, operates and provides its products and services in three business segments: Capital Access Platforms, Financial Technology and Market Services. Its Capital Access Platforms segment comprises Data & Listing Services, Index and Workflow & Insights. The Financial Technology segment comprises Financial Crime Management Technology, Regulatory Technology and Capital Markets Technology businesses. Its Market Services segment includes its equity derivative trading and clearing, cash equity trading, fixed income, currency and commodities trading. It operates over 19 exchanges across several asset classes, including derivatives, commodities, cash equity, debt, structured products and exchange-traded products (ETPs).
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Weak Performance Trends in Hong Kong IPO Market
- IPO Market Leader: According to KPMG, Hong Kong led the world in IPO funds raised in 2024, surpassing the New York Stock Exchange and Nasdaq, indicating strong market appeal.
- Post-Listing Underperformance: Of the 179 companies listed since January 2025, about half have seen their stock prices decline over the past three months, reflecting a broader trend of weak performance in Hong Kong IPOs compared to the mild drop in the Hang Seng Index.
- Capital Flow Trends: Following the inclusion of certain Hong Kong-listed stocks in the Stock Connect program, capital tends to flow to cheaper A shares, resulting in significant price volatility for these stocks, with some like Deepexi dropping over 51% post-IPO.
- Increased Market Pressure: Goldman Sachs predicts that Hong Kong will raise about $60 billion in IPOs in 2025, nearly double the amount raised in 2024, but low fees and intensifying competition are putting pressure on the financial market's short-term performance.
See More
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- Market Performance Review: During Trump's first term, the Dow Jones surged 57%, the S&P 500 rose 70%, and the Nasdaq soared 142%, indicating strong market performance; however, the 17% to 37% gains in his second term come with potential risks.
- Inflationary Pressures: The closure of the Strait of Hormuz due to the Iran war has halted the flow of 20 million barrels of oil daily, leading to an expected inflation rate jump from 2.4% to 4.18%, which may force the Federal Reserve to raise interest rates, putting pressure on the stock market.
- Valuation Warning: The Shiller P/E ratio for the S&P 500 has reached 42.66, nearing the historical high of 44.19, and historical data shows that bull markets with P/E ratios above 30 are often unsustainable, potentially leading to a market correction of 20% or more.
- SpaceX IPO Risks: SpaceX's upcoming IPO on June 12 aims to raise up to $75 billion, with a valuation of $1.8 trillion, resulting in a price-to-sales ratio of 96, which is unsustainable historically, raising concerns about a potential market crash.
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- Market Performance Review: During Trump's presidency, the Dow Jones, S&P 500, and Nasdaq surged by 57%, 70%, and 142%, respectively, indicating a positive impact of Trump's policies on the stock market.
- IPO Market Potential: SpaceX is set to go public on June 12, aiming to raise up to $75 billion with a valuation of at least $1.8 trillion, potentially breaking Saudi Aramco's record of $29.4 billion, drawing significant investor interest.
- Rising Inflation Pressure: The ongoing Iran war has led to soaring energy prices, with inflation projected to rise from 2.4% to 4.18%, which may compel the Federal Reserve to raise interest rates, negatively impacting the stock market.
- Valuation Concerns Intensify: SpaceX's expected price-to-sales ratio of 96 far exceeds any successful tech company historically, suggesting that the excitement surrounding its IPO may obscure underlying risks, increasing the likelihood of a market crash.
See More
SpaceX IPO Set to Become Largest in History
- Record IPO Size: SpaceX aims for an IPO valuation of at least $1.8 trillion and seeks to raise $75 billion, potentially surpassing Saudi Aramco's $29.4 billion, yet such a massive valuation raises concerns about a market bubble.
- Worrisome Financials: According to SpaceX's prospectus, projected revenue for 2025 is $18.7 billion with a staggering net loss of $4.9 billion, and Q1 2026 is still expected to show losses, highlighting the vulnerabilities of its capital-intensive business model that could undermine investor confidence.
- Historical Lessons: Mega-IPOs often stumble post-debut, as evidenced by Facebook's 38% drop in the six months following its IPO and Saudi Aramco's 15% decline, which raises apprehensions about SpaceX's future performance based on these historical precedents.
- Structural Risks Emerge: Changes in Nasdaq and other index rules allow for rapid inclusion of SpaceX, compelling passive funds to buy shares immediately post-IPO, which may trap retail investors into purchasing at inflated prices, leading to potential losses as insiders cash out early.
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SpaceX Aims for $1.8 Trillion Valuation in Historic IPO
- IPO Valuation Target: SpaceX plans to go public on June 12, aiming to raise $75 billion with a valuation of at least $1.8 trillion, which would make it the largest IPO in history, surpassing Saudi Aramco's $29.4 billion.
- Market Risk Warning: Despite the hype surrounding SpaceX's IPO, historical data indicates that similar mega-IPOs often perform poorly in the six months post-launch, as evidenced by Facebook and Saudi Aramco, suggesting significant potential losses for investors.
- Structural Changes Impact: Nasdaq has amended rules to shorten the waiting period for SpaceX's inclusion in the Nasdaq-100 from three months to just 15 trading days, which could lead to passive investment funds rapidly buying large amounts of stock post-IPO, resulting in a wealth transfer from retail investors.
- Insider Cash-Out Risk: SpaceX will implement a staggered share sale system allowing insiders to begin selling shares as soon as the second trading day after the first quarterly earnings release, potentially exacerbating risks for retail investors who may end up buying at inflated prices.
See More
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- Rule Change Proposal: The SEC plans to vote next week on a proposal to completely repeal a 20-year-old rule that prevents exchanges and alternative trading systems from executing trades that ignore the national best bid or offer, which could significantly impact fair treatment for individual investors.
- Concerns Over Market Impact: SEC Chairman Paul Atkins has opposed the repeal, fearing unintended consequences on the long-term growth of financial markets, particularly regarding increased transaction costs and execution speed.
- Scheduled Meeting: The SEC meeting is set for June 11 at 10:00 AM ET, where the vote on the repeal will take place, highlighting the market's keen interest in this policy shift.
- Industry Insights: At a fintech conference, SEC Trading and Markets Division Director Jamie Selway noted that the vote on repealing the rule is “genuinely on the table,” emphasizing that Atkins' perspectives will guide the SEC's future direction.
See More
Weak Performance Trends in Hong Kong IPO Market
- IPO Market Leader: According to KPMG, Hong Kong led the world in IPO funds raised in 2024, surpassing the New York Stock Exchange and Nasdaq, indicating strong market appeal.
- Post-Listing Underperformance: Of the 179 companies listed since January 2025, about half have seen their stock prices decline over the past three months, reflecting a broader trend of weak performance in Hong Kong IPOs compared to the mild drop in the Hang Seng Index.
- Capital Flow Trends: Following the inclusion of certain Hong Kong-listed stocks in the Stock Connect program, capital tends to flow to cheaper A shares, resulting in significant price volatility for these stocks, with some like Deepexi dropping over 51% post-IPO.
- Increased Market Pressure: Goldman Sachs predicts that Hong Kong will raise about $60 billion in IPOs in 2025, nearly double the amount raised in 2024, but low fees and intensifying competition are putting pressure on the financial market's short-term performance.
See More
Market Volatility Intensifies During Trump's Term
- Market Performance Review: During Trump's first term, the Dow Jones surged 57%, the S&P 500 rose 70%, and the Nasdaq soared 142%, indicating strong market performance; however, the 17% to 37% gains in his second term come with potential risks.
- Inflationary Pressures: The closure of the Strait of Hormuz due to the Iran war has halted the flow of 20 million barrels of oil daily, leading to an expected inflation rate jump from 2.4% to 4.18%, which may force the Federal Reserve to raise interest rates, putting pressure on the stock market.
- Valuation Warning: The Shiller P/E ratio for the S&P 500 has reached 42.66, nearing the historical high of 44.19, and historical data shows that bull markets with P/E ratios above 30 are often unsustainable, potentially leading to a market correction of 20% or more.
- SpaceX IPO Risks: SpaceX's upcoming IPO on June 12 aims to raise up to $75 billion, with a valuation of $1.8 trillion, resulting in a price-to-sales ratio of 96, which is unsustainable historically, raising concerns about a potential market crash.
See More
Trump Era Stock Market Performance Review
- Market Performance Review: During Trump's presidency, the Dow Jones, S&P 500, and Nasdaq surged by 57%, 70%, and 142%, respectively, indicating a positive impact of Trump's policies on the stock market.
- IPO Market Potential: SpaceX is set to go public on June 12, aiming to raise up to $75 billion with a valuation of at least $1.8 trillion, potentially breaking Saudi Aramco's record of $29.4 billion, drawing significant investor interest.
- Rising Inflation Pressure: The ongoing Iran war has led to soaring energy prices, with inflation projected to rise from 2.4% to 4.18%, which may compel the Federal Reserve to raise interest rates, negatively impacting the stock market.
- Valuation Concerns Intensify: SpaceX's expected price-to-sales ratio of 96 far exceeds any successful tech company historically, suggesting that the excitement surrounding its IPO may obscure underlying risks, increasing the likelihood of a market crash.
See More
SpaceX IPO Set to Become Largest in History
- Record IPO Size: SpaceX aims for an IPO valuation of at least $1.8 trillion and seeks to raise $75 billion, potentially surpassing Saudi Aramco's $29.4 billion, yet such a massive valuation raises concerns about a market bubble.
- Worrisome Financials: According to SpaceX's prospectus, projected revenue for 2025 is $18.7 billion with a staggering net loss of $4.9 billion, and Q1 2026 is still expected to show losses, highlighting the vulnerabilities of its capital-intensive business model that could undermine investor confidence.
- Historical Lessons: Mega-IPOs often stumble post-debut, as evidenced by Facebook's 38% drop in the six months following its IPO and Saudi Aramco's 15% decline, which raises apprehensions about SpaceX's future performance based on these historical precedents.
- Structural Risks Emerge: Changes in Nasdaq and other index rules allow for rapid inclusion of SpaceX, compelling passive funds to buy shares immediately post-IPO, which may trap retail investors into purchasing at inflated prices, leading to potential losses as insiders cash out early.
See More
SpaceX Aims for $1.8 Trillion Valuation in Historic IPO
- IPO Valuation Target: SpaceX plans to go public on June 12, aiming to raise $75 billion with a valuation of at least $1.8 trillion, which would make it the largest IPO in history, surpassing Saudi Aramco's $29.4 billion.
- Market Risk Warning: Despite the hype surrounding SpaceX's IPO, historical data indicates that similar mega-IPOs often perform poorly in the six months post-launch, as evidenced by Facebook and Saudi Aramco, suggesting significant potential losses for investors.
- Structural Changes Impact: Nasdaq has amended rules to shorten the waiting period for SpaceX's inclusion in the Nasdaq-100 from three months to just 15 trading days, which could lead to passive investment funds rapidly buying large amounts of stock post-IPO, resulting in a wealth transfer from retail investors.
- Insider Cash-Out Risk: SpaceX will implement a staggered share sale system allowing insiders to begin selling shares as soon as the second trading day after the first quarterly earnings release, potentially exacerbating risks for retail investors who may end up buying at inflated prices.
See More
SEC Plans Vote to Repeal 20-Year Trade Rule
- Rule Change Proposal: The SEC plans to vote next week on a proposal to completely repeal a 20-year-old rule that prevents exchanges and alternative trading systems from executing trades that ignore the national best bid or offer, which could significantly impact fair treatment for individual investors.
- Concerns Over Market Impact: SEC Chairman Paul Atkins has opposed the repeal, fearing unintended consequences on the long-term growth of financial markets, particularly regarding increased transaction costs and execution speed.
- Scheduled Meeting: The SEC meeting is set for June 11 at 10:00 AM ET, where the vote on the repeal will take place, highlighting the market's keen interest in this policy shift.
- Industry Insights: At a fintech conference, SEC Trading and Markets Division Director Jamie Selway noted that the vote on repealing the rule is “genuinely on the table,” emphasizing that Atkins' perspectives will guide the SEC's future direction.
See More
