The IPOX® Week #720
IPOX® Indexes trounce benchmarks on strong earnings.
Historical moves in index spreads: IPOX® 100 Europe, IPOX® International.
New Product Launch: IPOX® proudly launches the IPOX® Bond Indexes.
Read about the IPOs that started trading last week below.
IPOX® PERFORMANCE REVIEW: The IPOX® Indexes surged last week, with select indexes recording historic outperformance. Key driver behind the jump were explosive earnings reported by portfolio holdings triggering big short-covering as indexes broke through key technical resistance. Higher U.S. rates amid good economic data had little impact on trading. In the U.S., e.g. the FANG-free IPOX® 100 U.S. - underlying for the IPOX® 100 U.S. ETF from First Trust (ticker: FPX) and pooling more than $1 billion in combined assets - jumped +3.31% to +4.71% YTD, outperforming the S&P 500 (SPX) by a large +194 bps. Specialty screened bespoke portfolios recorded even bigger gains with the IPOX® U.S. ESG (IPXT) - an ESG-aware sub-portfolio of 100 large and highly liquid stocks based off the IPOX® U.S. Composite (IPXC) - adding a massive +6.48% to +10.94% YTD. Big strength extended to Markets abroad: Here, the story of the week belonged to the IPOX® 100 Europe (ETF: FPXE). In one of the largest relative moves in index history, the portfolio surged +4.78% to +5.29% YTD, surpassing its benchmark by +480 bps.. Explosive sentiment also extended to the IPOX® International (ETF: FPXI) which zoomed higher by +4.22% to +3.44% YTD, +416 bps. ahead of its benchmark. Amid the start of secondary offerings activity, including oil producer Saudi Aramco (ARAMCO AB: -0.97%), we note another strong week for the IPOX® MENA (IPEV). The diversified portfolio of highly liquid New Listings trading and domiciled across the MENA region added +2.20% to +5.80% YTD to close the week towards its all-time high.
IPOX® PORTFOLIO HOLDINGS IN FOCUS: Amid earnings and more (perceived) takeover activity for IPOX®-held biotechs, top of the list ranked 09/23 IPO U.K.-domiciled, NASDAQ-traded chip designer ARM Holdings (ARM US: +62.27%). Heavily weighted by multiple IPOX®-run portfolios, including the IPOX® 100 Europe (ETF FPXE), IPOX® International (ETF: FPXI), IPOX® U.S. ESG (IPXT) and long-only Rakuten Global IPO Fund - an alternative mutual fund available in Japan - the stock soared after reporting stellar earnings. Big gains in German biotech Morphosys (MOR GY: +52.04%) amid a Novartis-led buy-out proposal, as well as strong earnings from marine shipping firm Oslo-based Höegh Autoliners (HAUTO NO: +19.32%) also contributed to the outsized week for the IPOX® 100 Europe (ETF: FPXE). In the U.S., massive gains in intelligence software maker Direct Listing Palantir Technologies (PLTR US: +43.24%), infrastructure software maker Cloudflare (NET US: +30.57%), sustainable building products manufacturer Azek Holdings (AZEK US: +11.32%) and heavyweight GE-Spin-off GE Healthcare Technologies (GEHC US: +10.05%) after reporting stellar earnings led the IPOX® 100 U.S. (ETF: FPX). Moreover, multiple under-the-radar portfolio holdings reached fresh post-IPO highs, including Italian leading gaming operator 05/23 IPO P/E-backed Lottomatica Group (LTMC IM: +4.32%) and Saudi Integrated Oil firm 12/2022 IPO Saudi Aramco Base (LUBEREF AB: +6.68%), held in the IPOX® MENA (IPEV) and IPOX® International (ETF: FPXI), respectively. Select China-domiciled firms lagged anew, including contract testing, development and drug manufacturer 11/23 IPO WuXi XDC Cayman (2268 HK: -17.66%).
LIVE LAUNCH OF THE IPOX® BOND INDEXES: We are proud to note the live launch of the family of IPOX® Bond Indexes which seek to provide investors with turn-key access to the unique return dynamics and potential outperformance of U.S. dollar-denominated corporate debt issued in the U.S. by companies in the IPOX® Universe, including New Listings (IPOs, Spin-offs, SPAC and Direct Listings) and respective IPO M&A. These innovative indexes are designed as liquid and tradable benchmarks for passive and actively managed Financial Products, including ETFs. For more info, please contact info@ipox.com.
IPO ACTIVITY AND OUTLOOK: 20 accessible New Listings priced last week, with the average (median) equally-weighted deal (non-direct listings and de-SPAC) adding +22.85% (+5.51%) based on the difference between the final offering price and the Friday’s close. Deals in Europe and the U.S. dominated by size, including Greek infrastructure play Athens International Airport (AIA GA: +11.83%), NY-traded Mexican discounter BBB Foods (TBBB US: +8.86%), CA-based biotech Kyverna Therapeutics (KYTX US: +36.82%) and Germany’s defense firm RENK Group (R3NK GR: +33.86%), all ending Friday well above final offer. No significant accessible deal flow is lined up for this week, with the possible exception of London-traded Almati-based airline Air Astana (AIRA LI), whose conditional dealings in GDRs have already started on London International Exchange, with unconditional dealings to commence this Wednesday.
IPOX® SPAC INDEX (SPAC): The Index rose +2.14% to +1.10% YTD, broadly tracking the Russell 2000 (RTY: +2.41%) last week with biotech MoonLake (MLTX US: +14.37% and factory automation focused Symbotic (SYM US: -7.41%) in focus. Other SPAC news include: 1) SPAC Announced Merger Agreement include Slam Corp (SLAM US: +0.18%) with satellite-direct-to-phone telecom Lynk Global. 2) 3 SPAC Approved Business Combinations include L Catterton Asia Acquisition (LCAA US: -20.73%) approved merger with luxury sports car brand Lotus Technology (LOT: TBA). 3) 1 SPAC announced liquidation. 4) 2022 deSPAC cybersecurity firm ZeroFox (ZFOX US) acquired at a +43% premium by P/E firm Haveli Investments. 5) 2 new SPACs launched last week in the U.S.
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