Why is SpaceX stock up over 6% on Monday?
SpaceX shares SPCX rallied on Monday, recovering some of last week's losses as investors welcomed fresh buying from Cathie Wood's ARK Invest and a renewed vote of confidence from Wall Street analysts.
The stock gained more than 6% at 11:00 AM EDT, with the investment by Wood's fund manager emerging as a major positive catalyst.
The rebound comes at a politically sensitive time for CEO Elon Musk. His support for Republican candidates during the midterm elections has drawn attention following Democrats' victories in both chambers of Congress.
Investors have become increasingly concerned that the new political balance could bring greater scrutiny of Musk's businesses, particularly their data center and infrastructure expansion plans.
Trade SpaceX as ARK buying returns
Visit SiteInstitutional inflows are lifting sentiment around SpaceX’s next milestones.51% of retail investor accounts lose money when trading CFDs with this provider.Cathie Wood bets on SpaceX
ARK Invest bought SpaceX shares through three of its actively managed exchange-traded funds: ARK Innovation ETF (ARKK), ARK Autonomous Technology & Robotics ETF (ARKQ) and ARK Next Generation Internet ETF (ARKW).
ARK Invest purchased approximately $96 million worth of SpaceX shares across two consecutive trading sessions last week, taking advantage of the stock's decline following the midterm election results.
On November 4, the funds purchased 348,406 shares worth approximately $47.4 million. The following day, as SpaceX shares plunged during the technology selloff, ARK added another 393,774 shares worth approximately $48.7 million.
The combined purchases amounted to roughly $96 million, suggesting that Wood saw an opportunity to increase her exposure as the stock remains far from its post-IPO highs.
Stifel retains Buy rating
Adding to the positive sentiment, Stifel reiterated its Buy rating on SpaceX and maintained its $190 price target.
Analyst Jonathan Siegmann sees limited near-term disruption for SpaceX as he highlighted the company's investment-grade balance sheet and $40 billion in committed GPU financing.
He also said Qualcomm's selection as a radio supplier for SpaceX's planned macro cell sites would strengthen its ambitions to build a standalone wireless network.
Stifel further identified the upcoming Flight 15 launch as an important milestone for Starship's reusability and SpaceX's longer-term orbital computing ambitions.
The Flight 15 launch is scheduled for Friday, November 13.
Broader market rebound provides support
SpaceX also benefited from a wider recovery in technology stocks as investors attempted to recoup losses from last week's AI-led selloff.
The Nasdaq Composite climbed around 2.5%, while the S&P 500 and Dow Jones Industrial Average gained close to 2% each.
Chipmakers also participated in the rebound, even as Nvidia shares slipped with Chief Executive Jensen Huang at the center of a major controversy. The Philadelphia Semiconductor Index advanced more than 5%.
The recovery offered some relief to AI and infrastructure-related stocks that had faced selling pressure following concerns about data center regulation, financing costs and the sustainability of AI spending.
Particularly for SpaceX, the combination of institutional buying, bullish analyst commentary and improving broader market sentiment helped investors look beyond the political uncertainty surrounding Musk's businesses.