(Bloomberg) — Wall Street just spent the week ricocheting between the macro and the mania.
Investors digested mixed inflation data, positive developments in the Middle East conflict and sharp moves in oil prices. At the same time, a scramble for SpaceX exposure spilled far beyond the company’s stock sale, as investors sought alternative ways to participate in one of the most anticipated public debuts in years.
The result was a market struggling to settle on a single narrative, with investors lurching between macroeconomic developments and speculative trades. By one measure, the Nasdaq 100 this week posted its largest average intraday swings since April 2025.
SpaceX became the week’s flashpoint. Retail investors submitted more than $100 billion in orders for the offering, overwhelming allocations available through brokerages. But unlike past IPO frenzies, demand did not stop at the traditional order book. Investors unable to secure shares have been looking for exposure elsewhere. That helped drive big pre-IPO inflows into funds including the $2 billion Baron First Principles ETF, while fueling activity across a growing network of alternative trading venues.
Polymarket has generated more than $25 million of volume across SpaceX-related contracts. The activity also spilled into crypto-native markets, with investors trading perpetual futures linked to the company on the decentralized platform Hyperliquid. What once would have been a straightforward IPO story increasingly played out across multiple trading venues simultaneously.
“That we are seeing a proliferation in ETFs that tie to crowd-favorite stocks speaks to moment,” said Peter Atwater, the president of advisory firm Financial Insyghts. “The crowd is now speculating on its own manic impulsiveness with the most potency it can find.”
More than 20 SpaceX-linked ETFs have already been filed, ranging from leveraged and inverse products to options-based strategies. A leveraged ETF tied to SpaceX surged more than 80% before grinding to a halt Friday, according to data compiled by Bloomberg and information posted on the Cboe exchange’s website, citing regulatory concern. ETF issuers that once waited months after an IPO to launch related products are now racing to file almost immediately, underscoring the speed with which Wall Street moves to package speculative demand.
“There is room for speculating for sure, but I would rather investors invest,” said Nancy Tengler, CEO at Laffer Tengler Investments, who has a long-term conviction in the company.
The products used to express speculative views are becoming large enough to influence trading in the broader market. Strategists at Nomura estimate leveraged ETFs more broadly now generate roughly $8 billion of rebalancing demand for every 1% move in the market, while options positioning contributes billions more.
Barclays Plc recently estimated that similar flows tied to major US leveraged ETFs reached a record ahead of the selloff earlier this month. Such products do not determine market direction, but they can amplify prevailing trends, turning bursts of enthusiasm — or anxiety — into larger swings.
“The speculative ecosystem also argues for bigger swings around related names, because when exposure is built through leveraged and synthetic products, rallies and reversals can both move faster than investors expect,” said Chris Murphy, co-head of derivatives strategy at Susquehanna International Group.
The week’s swings reflected how quickly the market’s focus changed. A relatively tame consumer inflation data initially boosted risk assets. A day later, stronger producer-price data raised fresh questions on cost pressures. Meanwhile, comments from President Donald Trump on Iran repeatedly shifted expectations for the conflict and sent oil and equities in opposite directions. By Friday, hopes for a diplomatic breakthrough had helped lift stocks again.
“The on-again, off-again peace deal is driving sharp near-term moves at the index level, making it more challenging to analyze and invest at the single-stock level,” said Michael O’Rourke, chief market strategist at JonesTrading. “It muddies the waters as they try to navigate the mania.”
Signs of caution emerged alongside the speculative fervor. Susquehanna pointed to sizeable hedging activity in semiconductor ETFs, including large purchases of downside protection on the VanEck Semiconductor ETF. Even as investors chased growth stories, others were positioning for bigger swings ahead.
SpaceX was the week’s dominant obsession. But the more consequential story is how easily investors can now participate in — and build exposure around — a trade that might once have been confined largely to institutional investors.
For Aaron Korff, a 55-year-old Florida entrepreneur who runs a vehicle transport management software company, the SpaceX offering was impossible to ignore. Korff said he has never invested in an IPO before, largely because he viewed the process as cumbersome. This time was different. He submitted his request through E-Trade on Monday and got some allocation before the market opened on Friday, though the immense demand meant he only got a quarter of his initial order.
Still, Korff said the appeal extended beyond the market frenzy surrounding the stock.
“Who cares if it goes up and down? Do you love the company? Do you believe in its future? Those are the right reasons to invest in it,” he said. “Elon Musk will do anything and everything to drive the businesses forward. Look at what he has done with SpaceX so far.”
–With assistance from Muyao Shen, Demetrios Pogkas and Lu Wang.
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