By Saurabh Katiyar | New York
Wall Street fears Nasdaq rule change may force billions out of major tech companies
Elon Musk’s SpaceX is preparing for what could become one of the biggest IPOs in financial history, but the company’s stock market debut may also create serious turbulence across the technology sector.
According to multiple market reports, SpaceX’s expected public listing could force passive investment funds to dump billions of dollars in major tech stocks because of new Nasdaq rules introduced this month.
The Nasdaq Stock Exchange recently changed its policies to allow large IPO companies to enter the Nasdaq 100 index only 15 days after listing.
That change could have huge consequences for Wall Street.
If SpaceX joins the Nasdaq 100 shortly after its IPO, ETFs and passive investment funds tracking the index would automatically need to buy massive amounts of SpaceX shares.
At the same time, those funds may need to sell existing holdings in other large technology companies to make room for the new stock.
Analysts warn the result could trigger one of the biggest forced capital shifts the market has seen in years.
SpaceX Could Shake the Entire Nasdaq
SpaceX is reportedly targeting a valuation near $1.75 trillion during its IPO next month. Some analysts believe the company’s value could eventually rise above $2 trillion.
That would instantly make SpaceX one of the world’s most valuable publicly traded companies.
JPMorgan Chase estimates that if SpaceX reaches a $2 trillion market value with roughly half its shares available for trading, passive funds may need to sell around $95 billion worth of existing technology stocks.
Those sales would likely hit major Nasdaq companies already dominating the index.
TD Securities analyst Peter Haynes described the situation as a potentially “unprecedented single-index event.”
Market strategists say the danger comes from limited share availability after the IPO combined with extremely high investor demand.
Todd Sohn, chief strategist at Strategas ETF, warned that passive investors could be forced to buy SpaceX shares at inflated prices if the stock surges immediately after launch.
“If SpaceX rises 100% in the week after the IPO, and they have to buy in, they have no choice but to accept that price,” Sohn said.
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Retail Investors Get Rare IPO Access
Unlike many major IPOs, SpaceX plans to allow direct participation from retail investors.
According to filings submitted to the US Securities and Exchange Commission (SEC), investors using platforms like Robinhood, Fidelity Investments and Charles Schwab may be able to purchase shares at the same IPO price offered to large institutions.
That marks a major shift from traditional Wall Street IPO models, where institutional investors usually receive early access before retail buyers enter at much higher prices.
However, SpaceX also warned that share allocations will remain limited.
Each brokerage platform will set its own participation rules, and demand is expected to far exceed available shares.
Meanwhile, traders have already started speculating about which companies may be removed from the Nasdaq 100 to create room for SpaceX.
Some hedge funds reportedly began shorting stocks viewed as possible removal targets.
Analysts say the IPO could become a defining moment for both the technology sector and passive investing.
If the listing triggers extreme buying pressure and forced selling, Wall Street could face major volatility across AI, tech and growth stocks in the coming months.
OpenAI and Anthropic are also rumored to be preparing future IPOs, increasing concerns that the market could soon face an even larger wave of high-value technology listings.
