The IPOX® Week - September 5, 2023
Headlines:
- Strong September start for IPOX® ETFs, heavyweight Airbnb joins S&P 500.
- IPOX® MENA continues momentum to new high, amid BRICS expansion.
- Arm debuts 9/14. Instacart, Klaviyo, ADES, Birkenstock to launch in September.
- IPOX® SPAC (SPAC) gains +3.21%. No new SPACs launch in U.S. last week.
WEEKLY IPOX® PERFORMANCE REVIEW: At the end of a tough month for global equities, the IPOX® Indexes recorded a strong September start, beating major benchmarks across the board. In the U.S., short-term treasury yields fell as unemployment numbers rose and average hourly earnings only gained 0.2%, reinforcing expectations that the Fed may pause rate hikes this month. Amid a renewed decline in volatility (VIX: -16.52%) to the lowest weekly level since February 2020, the IPOX® 100 U.S. (ETF: FPX) soared +5.12% to +13.04% YTD, taking a massive 262 bps. from the S&P 500 (SPX) and 145 bps. from the Nasdaq 100 (NDX) last week. In Europe, inflation data was in focus, with sticky Eurozone August CPI data, while year-on-year core inflation dropped slightly, creating uncertainty over the ECB’s policy going forward. Nevertheless, the IPOX® 100 Europe (+3.05%, ETF: FPXE) outperformed the STOXX 50 Europe (SX5L) in August, gaining 186 bps. on the benchmark quarter-to-date. Internationally, the largest gains were seen in the IPOX® China (CNI: +6.12%), as China’s Caixin Manufacturing PMI unexpectedly rose above the midpoint, signaling growth rather than contraction. Amid talks of Saudi Arabia and the UAE joining the BRICS Bloc, the IPOX® MENA (IPEV: +1.51%) climbed to another new all-time high, outperforming most other major regional indices (see graph below). The IPOX® International (ETF: FPXI) gained anew, adding +2.96% to +4.59% YTD, beating the MSCI World (ex-USA) Index (MXWOU) again last week, taking 32 bps. from the benchmark.
GINDEX® PERFORMANCE REVIEW: Our innovative large-cap, super liquid portfolios with focus on acquirers of recent IPOs (IPO M&As) both gained last week. The U.S.-focused GINDEX® U.S. (GNDX: +3.47%) climbed to +13.13% YTD, while the international portfolio of the GINDEX® International (GNDXI: +1.64%) has improved by +5.46% since 3/17.
IPOX® PORTFOLIO STOCKS IN FOCUS: The IPOX® 100 U.S. (ETF: FPX) was led by “Internet of Things” cloud management firm Samsara (IOT: +22.45%), which soared to a new post-IPO high after posting Q2 earnings. EV maker Rivian (RIVN US: +16.14%) climbed after appointing previous Porsche North America president Gruner as new Chief Commercial Officer. Large cap heavyweight accommodation rental firm Airbnb (ABNB: +5.49%) added +6% in post-market trading on Friday, after S&P announced the inclusion to the S&P 500 benchmark. Speed camera maker, de-SPAC Verra Mobility (VRRM US: -8.40%), dipped after its accountant, Ernst & Young, resigned. Norwegian Internet browser firm Opera (OPRA US: +16.19%) topped the IPOX® 100 Europe (ETF: FPXE), resurging after its previous post-earnings dip. Swedish renewable wind energy firm OX2 (OX2 SS: -13.82%) fell as after-tax profits and operating margins slumped in Q2. Danish pharma firm Novo Nordisk (NOVOB DC: +1.82%), maker of diet drugs Ozempic/Wegovy reached a new high, becoming Europe’s largest firm by market capitalization after overtaking fashion giant LVMH. In the IPOX® International (ETF: FPXI), heavyweight holding Chinese E-commerce giant Pinduoduo (PDD US: +29.26%) operator of App Store chart leader, online shop Temu, rocketed after earnings. Entertainment producer STAR CM Holdings (6698 HK: -54.67%) plummeted for a third week after halting hit TV show The Voice of China.
GLOBAL IPO DEAL FLOW REVIEW AND OUTLOOK: 2 sizable IPOs started trading last week, gaining +63.25% from offer price to Friday’s close. Real estate development firm Kuru Grup (KZGYO TI: +32.95%, $38m offer) listed in Turkey, while industrial lubricant specialist PSP Specialities (PSP TB: +93.55%, $61m) surged in Thailand.
2 sizable international deals are expected next week. Tuesday: Chinese tumor immunotherapy developer ImmuneOnco Biopharmaceuticals (1541 HK, $41m offer) in Hong Kong. Wednesday: Turkish retailer of mother and baby products Ebebek (EBEBK TI, $70m offer).
After a quiet month for new listings, September is expected to see an uptick in deal flow with major IPOs from chipmaker Arm (14/9; up to $7b offer), online shopping app Instacart (around $1b offer), marketing firm Klaviyo (est. valuation $9b), German footwear maker Birkenstock (est. valuation $8b) and Saudi state fund-backed oil driller Ades (around $1b offer, largest in Saudi Arabia this year).
THE IPOX® SPAC (SPAC): The Index of 50 constituents at both the pre- and post-consummation stage surged +3.21% to +16.82% YTD. IPOX® SPAC movers included autoimmune diseases-focused pharma company Immunovant (IMVT US: +19.59%) and Bitcoin miner Bitdeer Technologies Group (BTDR US: -9.21%) after SEC delayed decision on potential Spot Bitcoin ETF. Other SPAC news: 1) No SPAC Announced Merger Agreement. 2) 4 SPACs Approved/Completed Business Combinations, e.g., Fifth Wall Acquisition III completed merger with parking garage owner Mobile Infrastructure Corp (BEEP US: +12.81%). 3) 2 SPACs announced liquidation. 4) No SPACs launched last week.
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