The IPOX® Week, March 8th, 2021

  • IPOX® Indexes record sharp declines as global re-opening momentum builds; higher yields weigh.
  • a) IPOX® 100 U.S. (ETF: FPX) declines to +1.19% YTD.
    b) IPOX® International (ETF: FPXI) falls to -3.88% YTD.
    c) IPOX® 100 Europe (ETF: FPXE) drops to -6.15% YTD.
  • IPOX® SPAC (SPAC) weakens to +4.27% YTD.
  • IPO sentiment turns mixed as more high-profile deals line up.

IPOX® Indexes record sharp declines as global re-opening momentum builds; higher yields weigh.  The IPOX® Indexes fell for a second week, weighed by asset allocation selling in high-growth, less seasoned companies across the global regions, as the re-opening momentum built further, global yields continued to accelerate higher, while underpinning (U.S.) economic indicators forecast a goldilocks economy. In the U.S., e.g., the IPOX® 100 U.S., underlying for the $2 billion “FPX” ETF, slid -5.77% to +1.19% YTD, now +290 bps. YTD ahead of the Nasdaq 100 (NDX), while lagging the S&P 500 (SPX) by -110 bps. YTD. Here, 79/100 portfolio holdings declined last week, with the average (median) stock shedding -6.09% (-6.08%), lagging the applied market-cap weighted IPOX® 100 U.S. (ETF: FPX). Declines extended to markets abroad with China-linked and European exposure being particularly hit hard.

IPOX® Portfolio Holdings in focus: In the U.S., advertising technology platform play The Trade Desk (TTD US: -18.78%) fell sharply after Google clarified its ad-tracking policy, software maker Okta (OKTA US: -17.40%) plunged after announcing to acquire software firm Auth0 and insurance provider Lemonade (LMND US: -26.15%) sank after disappointing quarterly results. With VALUE outperforming GROWTH, we note another big week for respective IPOX® Holdings, including multimedia firm ViacomCBS (VIAC US: +15.12%), Spin-off chemical products maker Dow (DOW US: +6.07%), and IPO M&A commercial vehicles maker Cummins (CMI US: +5.00%). Abroad, firms including drug store operator JD Health (6618 HK: -14.32%), Chinese cloud software provider Ming Yuan Cloud Group (909 HK: -12.76%), Swedish application software maker Sinch (SINCH SS: -11.14%) and Brazils payment processor StoneCo (STNE US: -10.65%) recorded big declines. The overall weakness was only partially offset by gains in Mexican tequila maker Becle (CERVO* MM: -4.73%), Brazil’s IPO M&A retail platform Magazine Luiza (MGLU3 BS: +3.93%) and IPOX® heavyweight oil producer Saudi Aramco (ARAMCO AB: +1.88%).

Select IPOX® Indexes Price Returns (%) 2020 Last Week YTD
IPOX® Indexes: Global/International
IPOX® Global Super Liquid (IPGL50) (USD) 66.63 -4.43 1.78
IPOX® International (IPXI) (USD) (ETF : FPXI) 72.15 -4.77 -3.88
IPOX® Indexes: United States
IPOX® 100 U.S. (IPXO)* (USD) (ETF: FPX) 47.32 -5.77 1.19
IPOX® ESG (IPXT) (USD) 42.29 -4.27 1.53
IPOX® SPAC (SPAC) (USD)** 48.52 -5.68 4.27
IPOX® Indexes: Europe/Nordic
IPOX® 100 Europe (IPOE) (USD) (ETF: FPXE) 35.14 -6.07 -6.15
IPOX® Nordic Core (IPND) (EUR) 59.89 -3.65 -0.62
IPOX® Indexes: Asia-Pacific/China
IPOX® Asia-Pacific (IPTA) (USD) 47.50 -1.78 -3.37
IPOX® China Core (CNI) (USD) 88.02 -6.02 1.80
IPOX® Japan (IPJP)(JPY) 25.75 0.39 -3.17

* Basis for CME-traded e-mini IPOX® 100 U.S. Futures (IPOH1). Source: Bloomberg. Prices exclude dividends. **since July 30, 2020.

IPOX® SPAC (SPAC). The Index fell -5.68 % on the week to +4.27% YTD and +54.87% since its 7/30/2020 launch. SPAC news include: 1) 9 SPACs Announced Merger Agreement/LOI include (partially): a) Good Works Acquisition with bitcoin miner Cipher Mining, b) Sustainable Opportunities Acquisition with EV battery metals developer DeepGreen Metals and c) Reinvent Technology Partners Z with insurtech unicorn Hippo. 2) 1 SPAC Completed Business Combination include: a) Switchback Energy Acquisition with EV charging stations network ChargePoint (CHPT). 3) Deals reportedly in talks include: a) Altimar Acquisition II with Apollo portfolio company -online photo-book maker Shutterfly, b) Walmart owned Indian e-commerce Flipkart, c) Swiss gambling data firm Sportradar with Horizon Acquisition II and d) Microsoft-backed Indonesian e-commerce company 4) A massive 39 new SPACs flooded the market on the week.

IPO Deal-flow Review and Outlook:  11 IPOs launched across the global regions last week with the average (median) equally weighted deal added +6.48% (0.00%) based on the difference between the final offering price and respective first close. Two high-profile deals traded mixed, including Insurtech Oscar Health (OSCR US: -20.51%) and Russian dollar-store chain Fix Price (FIXP LI: 0.00%). U.S. gaming platform Roblox (RBLX US) and SoftBank-backed Korean e-commerce giant Coupang (CPNG US) are in focus this week for its respective Direct Listing and IPO. Other IPO news include: 1) online thrift store ThredUp, online education firm Coursera, defense contractor Leonardo DRS, healthcare platform Alignment, real estate brokerage Compass, and “Chinese Quora” Zhihu all file for U.S. IPOs last week. 2) German drugmaker Cheplapharm, European industrial property developer CTP, Swedish real estate portal Hemnet, and U.S. online forum Reddit mull IPO. 3) Instant noodle manufacturer Monde Nissin filed for largest IPO in Philippine. 4) Grocery delivery startup Instacart may opt for Direct Listing.

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