The IPOX® Week #742
IPOX® buyoant as equity rally broaderns. IPOX® Bonds surge anew.
IPOX® International (FPXI), IPOX® Europe (FPXE) at multi-year High.
M&A-focused GINDEX® U.S./International surge anew, outperform.
4 sizeable deals lined up for debut. U.S.-based Ardent Health (ARDT) largest.
SUMMARY: The IPOX® Indexes built on their recent string of gains as the big rally in U.S. large-caps and Technology stocks broadened out last week, with many IPOX® Portfolio Holdings being key beneficiaries. Muted inflation numbers on the Wholesale (PPI) and Consumer (CPI) levels drove positive sentiment, indicated by another great showing in the IPOX® Aggregate Corporate Bond Index (IPOXTD). The unique and highly liquid portfolio tracking the price of U.S.-traded fixed income of IPOX® Portfolio Holdings added +0.85% to +1.33% YTD, with strong gains extending to its sub-portfolios. For example, the IPOX® Investment Grade Bond Index (IPXULQD) extended its YTD return to +1.33%, while the IPOX® High Yield Bond Index (IPXUHYG) surged to +4.20% YTD, +20 bps. and +66 bps. ahead of their respective benchmarks.
Ahead of earnings, the picture across equities was similarly positive, with outperformance finally extending to the IPOX® 100 U.S. (FPX). The portfolio, which provides systematic access to the latest investment themes as defined by IPOs and Spin-off activity of U.S. domiciled companies, added +1.82% to +6.71% YTD for a 3rd straight week of gains, outpacing the S&P 500 (SPY), benchmark for U.S. stocks, by a strong +95 bps. Here, gains were driven by select health care/biotech exposure, including Kymera Therapeutics (KYMR US: +39.84%), United Therapeutics (UTHR US: +2.17%), and Arcellx (ACLX US: +15.33%), propelling the IPOX® Health Innovation (IPHI: +5.79%) to the top of our index performers last week. Notable outliers across non-healthcare exposure included de-SPAC AST SpaceMobile (ASTS US: +4.92%), a TX-based operator of a Space-based telecom network. Amid the big gain in the IPOX® Corporate Bond Indexes (IPOXTD, IPXUHYG, and IPXULQD), more heavily leveraged firms outperformed, including best-in-breed global Climate play Spin-off heavyweight Carrier (CARR US: +4.36%), elevator maker Otis (OTIS US: +3.44%), and IPO M&A mortgage-focused Mr. Cooper Group (COOP US: +6.34%).
In non-U.S. domiciled exposure, select IPOX® Regional Indexes continued to perform well and propelled the IPOX® International (ETF: FPXI) further, with the portfolio adding another +1.56% to +15.47% YTD (+21.32% Y/Y) to close out the U.S. trading week towards yet another fresh multi-year high, doubling the performance of the benchmark YTD (Y/Y) and continuing the recovery of post-COVID losses.
Amid the broad weakness in the U.S. dollar across currency pairs, we also note a fresh weekly post-IPO high in Brazil digital bank operator Nu Holdings (NU US: +4.60%) and Sweden-based wealth manager Nordnet (SAVE SS: +3.54%). Among holdings sourced from IPO M&As, Canada-domiciled software maker Constellation (CSU CN: +4.22%), Australian IPO M&A gaming machine manufacturer Aristocrat Leisure (ALL AU: +3.85%), and Ireland-based healthcare services provider Icon (ICLR US: +4.76%) also performed well last week.
Indeed, in the cross-section of our product universe, we continue to note significant relative strength in our GINDEX® International (GNDXI), a portfolio exclusively focused on international IPO M&As. The low-beta, high-dividend, and broad-based portfolio of highly liquid companies added +2.01% to +12.15% YTD, a strong +439 bps. ahead of its benchmark.
IPOX® SPAC Index (SPAC): The Index added +2.50% last week to -1.30% YTD. Voice AI and speech recognition software company SoundHound AI (SOUN US) surged +47.97% on ChatGPT integrated voice assistant production with European carmakers. New Providence Acquisition (NPAB US) fell -6.37% as the pre-announcement SPAC traded significantly above NAV. No SPAC announced a merger target. One merger deal closed this week with Catcha Investment (CHAA US) completing its business combination with harsh weather LNG terminal developer Crown LNG (CGBS US), which fell -62.14%. Two new SPACs launched this week in the U.S.
ECM REVIEW AND OUTLOOK: New listings raised $2.2 billion globally last week, including 10 sizable (>$25m offer size) IPOs in accessible markets, which gained +22.28% (average) / 0.00% (median) between offer price and Friday's close. South Korean gaming firm SHIFT UP (462870 KS: +16.83%) was the largest new listing, surging after raising $320 million. In Hong Kong, U.S.-based but Chinese-owned Cirrus Aircraft (2507 HK: 0.00%) raised $193 million, while Chinese ride-hailing firm Chenqi Technology (9680 HK: -2.14%) debuted with a $134 million offering. Malaysia saw its largest listing in two years with Johor Plantations Group (JPG MK: +4.76%) raising $156 million. Notable performances included Jersey-based private equity investment vehicle Rosebank Industries (ROSE LN: +170.00%) skyrocketing after its $64 million London listing, and Thai food producer Chaosua Foods Industry (CHAO TB: +18.64%) following its $30 million Bangkok debut.
This week's IPO Calendar features five notable listings. In Hong Kong, automobile store GL-Carlink Technology (2531 HK), a provider of SaaS solutions for automobile stores, aims to raise $43.8 million on July 15. The U.S. market will see three IPOs: TWFG Insurance (TWFG), an insurance brokerage platform, plans to raise $176 million on the Nasdaq on July 17. On the same day, Ardent Health Partners (ARDT), a hospital company operating 30 acute care hospitals and over 200 care sites, targets $314.6 million in its NYSE debut. Actuate Therapeutics (ACTU), a pharmaceuticals company developing cancer treatments, is set to raise $55.56 million on Nasdaq on July 18.
Follow our IPO Calendar and social media (e.g. Linkedin) for upcoming IPOs, updates on our indexes and the latest IPO News. Read the latest IPOX® Update for a summary of last week’s news.
