Shares of Elon Musk’s company, SpaceX, have been falling for three consecutive days. Shares closed 16.4% lower at $154.60 on Monday. Due to such a massive selloff, the company’s value declined by $600 billion (approximately ₹50 lakh crore) in just three days. After reaching an all-time high of $201.80 on July 16, the stock is down 31.5% from its peak.
Why are SpaceX shares falling?
According to a Bloomberg report, the company’s new bond sale plan is being considered the main reason for the fall in the share price. SpaceX had announced plans to borrow more than $20 billion through a bond sale to raise funds for large projects related to Artificial Intelligence (AI) and space exploration.
Investors became nervous about this massive loan plan, fearing that it would significantly increase the company’s debt burden. Meanwhile, rating agency MSCI gave the company its lowest rating of ‘CCC’ citing corporate governance and environmental risks. This triggered massive selling in shares.
Panic on Wall Street
After SpaceX got a ‘CCC’ rating yesterday, the fall was not just limited to the company’s shares; There was a wave of ‘panic selling’ in the tech sector. Big hedge funds started selling shares of tech companies like Alphabet and Meta, which fell 4.5-5%. This caused a huge fall in the Nasdaq index.
Company owner Elon Musk also suffered a major setback; His net worth declined by $152 billion (approximately ₹12.5 lakh crore) in a single day. However, despite such a huge decline, Musk remains the only trillionaire and the richest person in the world with a net worth of $1.1 trillion.
