All week the markets seemed to be holding steady, waiting for news that would gently encourage them, but instead in Friday’s final furlong they pulled up [Ed – as in went down!]

The Nasdaq 100 plummeted about 5%, its deepest dive since April of last year, while a gauge of chipmakers fell twice as much on Friday, as Wall Street ended the weak on a decidedly sour note, according to Bloomberg.

What might be eating at investors (despite the frenzy over SpaceX’s IPO) is a return of that unscratchable itch known as fear of over-valuation. Worries that a tech stock bubble may soon deflate combined with surprisingly big jobs numbers, and thus suspicions the Fed — even with a new chair courtesy of Commander In Chief, Donald Trump — could raise rates, triggered serious profit-taking.

As is the way with these things, the FTSE 100 index in the UK was green on Friday highlighting the need for diversification in portfolios, and above all else a willingness to stay the course.

There will be a fair few comments in this week’s bulletin about SpaceX’s initial public offering. If you are wondering what the fuss is all about, other than the eye-watering figures involved, how does $920 million-per-month strike you? That’s pretty steep rent for most, but when you’re Google, you can afford it. That’s how much it agreed to pay SpaceX for computing power as part of a cloud-services deal that runs through mid-2029.

Enough to make you Sea The Stars.

Market News 

As there was a late change in markets this week I need a New Approach. So, its just going to be a select few this week with a Quest For Fame.

Lothar Mentel and Workforce at Tatton Investment Management provide the first Reference Point with the usual Tatton Weekly, covering the following areas:

• Markets decelerate – With the global economy faring better than expected but the oil supply crisis unresolved, markets are beginning to fear rate rises will spoil the party.
• May asset returns review – A ceasefire induced stalemate in the US-Iran war proved sufficient to calm markets and refocus them on strong tech driven earnings growth. Bond market volatility served as a reminder that much uncertainty remains.
• Affordability weighs on house prices – Canada’s house prices have been falling for years and reflect wider issues for builders, including the UK, but does unaffordable simply mean overvalued?

This week, Jane Parry, Chief Marketing Officer at Canaccord, is joined by Tom Hibbert, Chief Investment Strategist, to discuss that although AI is powering the market rally, is it also starting to push inflation higher? 

 Listen to the podcast here

The latest Rathbones’ Monthly Digest explains why, as investors, they caution against too much caution, in weighing up the risks posed by the Iran war and the growth of AI.

In this piece:

• The US S&P 500 is reaching record highs, despite the Iran war.
• Investors should be aware that both the US and Iran have strong reasons for ending the conflict.
• Chip makers could be generating abnormal profits for some time, given limited production capacity for the foreseeable future and ballooning demand.

And I can share an update from Charles Stanley’s Group Chief Investment Officer, Patrick Farrell outlining our current views on the current situation in the Middle East and what it may mean for markets and investments covering these issues:

• As we approach 100 days into the Middle East conflict, the situation remains uncertain. While there are some tentative positives, such as ongoing diplomatic efforts and a conditional ceasefire between Israel and Lebanon, progress overall has been limited, particularly around Iran and the reopening of the Strait of Hormuz.
• The continued disruption to this key energy route is the main concern for markets, keeping oil prices elevated and adding inflationary pressure at a time when central banks had been expected to ease policy. This has shifted expectations towards potential rate rises rather than cuts. Despite this, equity markets, particularly in the US, have remained resilient, reaching new highs.
• From an investment perspective, the focus remains on diversification and maintaining a long-term view despite short-term volatility.

Ruler of the World?

12^th June 2026. SpaceX goes public reports 7IM.

If you want a dose of Elon Musk’s Mars magic, you will (shortly) be able to get involved. SpaceX will charge investors $135 per share to buy into its eagerly anticipated IPO.

But what if you don’t want to buy it?

Maybe you want to wait until it turns a profit.

Maybe you became worried after Blue Origin’s spectacular failure.

Maybe you think the pitch of “AI data centres in space is a market as big as the Chinese economy” is a bit punchy …

Let’s hope the Martians want to use ChatGPT …

Source: Space Exploration Technologies Form S-1

There are lots of decent reasons to wait a little bit before jumping into a new listing.

For years, index providers like FTSE Russell & S&P Dow Jones have been cautious about adding brand new listings, trying to balance the opportunity of investing in new businesses, vs. wanting to stop possibly dodgy, easily-manipulated stocks from ending up in the hands of passive investors, without their knowledge. So, their listing rules required businesses to actually make money consistently, reach a certain size and most importantly, just to haveexisted for a decent length of time as a public company.

This stopped a number of disastrous hyped-up listings from hurting passive investors in 2021.

Companies like Babylon (the online GP app), WeWork (renting individual workspaces at a loss) or Nikola (electric trucks, founder now in prison for fraud) …

Source: FactSet

But this time, the guardrails are going away. Any ETFs/tracker funds HAVE to buy, the day the index changes …

And the index providers are making all kinds of exceptions for SpaceX, treating it as the biggest VIP of all time. Technically they aren’t “breaking” the rules so much as rewriting them, but you know.

The key change is speed – letting SpaceX enter the index without a cool-down period.

• S&P is suggesting that SpaceX will only need to be listed for six months (rather than the normal 12 months).
• NASDAQ has said it will add SpaceX after 15 days (normally changes are only made in December each year).
• FTSE Russell has gone quickest of all. After just 5 days, SpaceX will be part of various indices (it usually takes at least 3 months, if not more).*

 So (even ignoring S&P come December), within a month we could be in a very odd situation where there are a load of people who OWN SpaceX and want to sell (the early investors), a load of others who own the shares even though they didn’t want to (index investors) and then a load of people who want to own SpaceX but CAN’T**, because index investors keep buying up all the stock.

And of course,  Elon Musk continuing to run the business as a private company because he has 85% of the voting shares!

Add into that the actual business of putting rockets into orbit repeatedly and it’s going to be a heck of a ride …

*Indexology Blog: Seasoning to Taste / 
Nasdaq-100 Index® Consultation – February 2026 / 
Market Consultation: Russell US Equity Indexes

**Technically, can’t at the price they want to.

Quartet IM Fun Fact

SpaceX has named its recovery ships things like “Of Course I Still Love You” and “Just Read the Instructions,” which is a very SpaceX-style mix of engineering and nerd humour.

Charts of the Week

‘If you torture the data long enough, it will confess to anything.’ This marvellous quote is attributed to Nobel laureate economist Ronald Coase. It warns of the dangers of seeking out confirmation for what we want to believe says Tom Stevenson from Fidelity International.

This is a particularly dangerous behavioural flaw for investors. We do it all the time. Looking for reasons why a stock or fund we hold should continue to rise. Seeking out reasons not to buy into a theme we have missed out on.

Here’s a great example of how risky this confirmation bias can be.

When it comes to the gold price, people are divided. After a couple of years of outperformance – gold has doubled since the beginning of 2025 – it is tempting to think it has peaked.

History is littered with examples of gold spiking higher and then moving sideways or falling dramatically. The hangover can continue for years with gold.

I went in search of a comparison that would prove my hunch that gold has gone too far too fast. I remembered that the precious metal had spiked higher at the end of the 1970s, during the last big energy crisis. And again in the run up to the financial crisis.

Using a new feature on the Refinitiv system, which enables comparisons across different time periods, this is what I came up with.

That’s a pretty scary chart. By carefully selecting the start dates and rebasing the two lines, I could make a strong case that, just like in the period around the Iranian revolution in 1979, the gold price has overshot on geo-political and economic fears – and risks falling back rapidly as those concerns are better understood.

But what if this chart is just a visual confirmation of what I already believe. One clue is that the lines start at quite different places over on the left-hand side. In both periods, the gold price rises strongly but the gains more recently still pale by comparison with the spike nearly 50 years ago.

So, to test whether I’d just indulged in some wishful thinking, I played around with different start dates and rebased the charts not at the peak but at the start.

This is what I came up with:

The same data but looked at through a different lens. And telling a completely different story.

Looked at this way, the comparison between the two lines is much closer. The trajectory of the gold price in the years before the Iranian revolution and associated oil price shock is almost identical to the doubling in the gold price over the past two to three years.

Far from pointing to an imminent reversal in the gold price, this way of looking at the historic parallel, suggests that the precious metal could yet rise much further. It hints that a further deterioration in the fragile situation in the Middle East (or some other unknown event) could still trigger a flight to the perceived safety of gold.

So, what can we learn from these two charts?

First, that data is not neutral. It reflects the biases of the person who creates it. We need to treat historic comparisons with great care.

Second, that the future is inherently uncertain. Even when one outcome looks probable, we should be prepared for the possibility that we are wrong. Hope for the best and prepare for the worst is a good mantra.

But third, that while history does not repeat itself, it does rhyme. The closeness of the fit of the two lines in the second chart is compelling. It does not mean that they will continue to track each other but it is an indication of what might happen. At the very least, it argues for a well-diversified portfolio that would not leave you with raging FOMO if the gold price did accelerate again.

Miscellaneous

A new report by Pensions UK suggested that too many people face a “cliff-edge drop in income” when they retire with more than three-quarters not on course to save enough for a moderate lifestyle. Reported on the BBC, Pensions UK estimated just 23% of the working population would reach between £32,700 pa for one person and £45,500 pa for two – the figure deemed necessary to provide a ‘moderate’ lifestyle in retirement. If you want to know how your plans are on track, don’t forget the Retirement Planner Survey on the JB Wealth website, or speak to your usual JB Wealth advisor.

Bitcoin Falls Below $60,000 for First Time Since 2024 Trump Win. I expect the internet will go quiet as nobody ever heralds their crypto losses!

On a day when Christmas Day went into the record books alongside Santa Claus and added to my not so hidden horses, I just wanted to mark the 82nd anniversary of D Day and everyone who took part are my Diomed(es). 

I hope to catch up with you next time.