The IPOX® Week #750
IPOX® Equity Strategies beat Nasdaq, small caps amid broad volatility.
IPOX® Bonds outshine equities as fears drive shift to safe haven assets.
Select Healthcare holdings outperform on clinical trial results, lead indexes.
Two large pharma-backed biotech IPOs expected in the U.S. this week.
OVERVIEW: Amid a shortened labor day trading week, recession fears intensified in the U.S. last week as the jobs report for August missed expectations, with prior months’ figures revised downward. Three-month payroll growth slowed to its weakest level since mid-2020, while market volatility spiked sharply (VIX: +49.20%). U.S. equities had their worst week since March 2023, with the S&P 500 closing down -4.25%. The IPOX® Equity Strategies followed suit, with the IPOX® 100 U.S. ETF (FPX) down -4.70%, although still outperforming the tech-heavy Nasdaq 100 (NDX: -5.89%) and small caps Russell 2000 (RTY: -5.69%).
Bonds, including the IPOX® Bond Indexes, gained ground as investors shifted to safer assets amid growing concerns about economic slowdown. U.S. Treasuries fell across the board, with 30-year bonds closing in on the 4% mark. Internationally, the IPOX® 100 Europe (ETF: FPXE) and IPOX® International (ETF: FPXI) sank in line with broader market declines. Meanwhile, the IPOX® MENA Index rose +1.11%, buoyed by OPEC’s decision to delay a Crude output hike, supporting equities in oil-rich GCC economies.
PORTFOLIO HOLDINGS IN FOCUS: Despite the general market downturn, select IPOX® Holdings delivered strong performances. Healthcare stocks were represented amongst the largest gainers, adding to the IPOX® 100 U.S. and propping up the IPOX® Health Innovation Index (IPHI), which declined -1.91% but outperformed many broader indexes. Pneumococcal vaccine maker Vaxcyte (PCVX US: +38.16%) led the pack, surging on breakthrough clinical trial results and a subsequent $1.2 billion follow-on offer. Hematology and cardiovascular-focused Keros Therapeutics (KROS US: +15.79%) also posted significant gains on encouraging trial results. Cancer biotech Immatics (IMTX US: +5.77%) continued to rise following an analyst upgrade, and consumer healthcare spin-off Kenvue (KVUE US: +4.15%) hit a 52-week high on strong momentum.
In the IPOX® 100 Europe, Amsterdam-listed Polish logistics giant Inpost (INPST NA: +7.38%) jumped after raising guidance and reporting higher margins abroad, while IPOX® 100 U.S. index member Samsara (IOT US: +7.18%) reached a new post-IPO high on strong revenue results and improved forecasts. Index heavyweight Palantir (PLTR US) surged +8.45% after hours on S&P 500 inclusion.
On the downside, muscle dystrophy specialist Dyne Therapeutics (DYN US: -28.34%) plunged after a surprise departure by 3 executives amid missed trial targets. Network connection semiconductor firm Credo Technology (CRDO US: -30.16%) tumbled on a disappointing Q1 loss. Infrastructure firm Core & Main (CNM US: -20.78%) dropped after cutting its forecasts despite higher sales. Crypto exchange Coinbase (COIN US: -19.64%) also struggled as it faces a looming shareholder lawsuit over regulatory issues tied to the SEC.
IPOX® CORPORATE BOND UPDATE: The IPOX® Bond Indexes of corporate bonds linked to IPOX® Portfolio Holdings surged as recession fears drove a rally in bond markets, with the IPOX® Aggregate Bond Index up +1.35% for the week. The IPOX® Liquid Investment Grade Bond Index also gained +1.47%, and the IPOX® High Yield Bond Index added +0.18%. These gains reflect the strong demand for bonds as investors sought safety amid concerns about a slowing U.S. economy, pushing the indexes to new highs since index launch.
THE IPOX SPAC INDEX (SPAC): The Index fell -4.70% in U.S. Labor-day holiday shortened trading week to -9.44% YTD. Clinical-stage hematology-focused biopharmaceutical company Disc Medicine (IRON US) rose +3.18%. Lidar sensor company Ouster (OUST US) tanked -17.60%, continuing to spiral down as sell-off persisted after weak earnings. 5 SPACs announced definitive targets, including Keen Vision Acquisition (KVAC US) +0.28% with cardiovascular gene therapy biotech Medera. INFINT Acquisition completed merger with Singapore-based Indonesian-market focused payment platform Seamless Group/operating as CURREN•C Group (CURR US) -48.73%. SPAC activity rose again with 2 new SPACs launched this week in the U.S.
ECM REVIEW AND OUTLOOK: 20 new global IPOs raised $850 million last week. The average listing gained +65.04% (+35.82% median) between offer price and Friday’s close, with continuing strong focus on India, where 10 listings raised $526 million. Indian renewable energy supplier Premier Energies (PREMIERE IN: +143.57%) was the largest listing, skyrocketing on continuing demand for IPOs in the region. No sizable IPOs launched on U.S. markets.
For this week, we are expecting the launch of Malaysian convenience store retailer 99 Speed Mart (99SMARTMK, $506 million), the country’s largest IPO in 7 years. In the U.S., we might see the debut of two health care firms, both aiming to raise around $200 million: Cancer biotech Bicara Therapeutics (BCAX), backed by India’s largest biopharmaceutical company Biocon, and immunology pharma Zenas BioPharma (ZBIO), backed by Bristol-Myers Squibb.
In the latest IPOX® Update several major upcoming IPOs are highlighted, including cement firm Titan America’s $500 million U.S. listing, luggage leader Samsonite’s dual U.S.-Hong Kong offering, and Chinese household appliances giant Midea Group’s $3 billion Hong Kong IPO, the largest in the region since 2021. Carlyle’s luxury watch component maker Acrotec Group could raise $4.7 billion in Zurich. Other notable deals include Delivery Hero’s MENA unit Talabat $1 billion listing in Dubai and Indian agricultural seed firm Advanta Enterprises planning a $500 million domestic IPO by 2025.
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