What’s News in Markets: AI Whiplash, SpaceX’s Historic IPO, Knicks Fever

0:00I'm Steve Booth, CEO of Baird, an independent wealth, asset management, and global capital markets firm. At Baird, our 5 ,000-plus employees are united by an unwavering commitment to excellence and a genuine passion for helping our clients and each other succeed. As a privately held, truly employee-owned company, we treasure our independence since we can focus on delivering results to clients and taking care of our people throughout the cycles in our serve markets. Learn more at rwbaird.com slash WSJ.

0:33Hey listeners, it's Saturday, June 13th. I'm Imani Moise for The Wall Street Journal. And this is What's News in Markets, our look at the biggest stock moves of the week and the news that drove them. Let's dive in. Markets went on a rollercoaster ride this week. The Dow suffered its worst day of the year on Wednesday after escalating conflict in the Middle East raised concerns that higher oil prices could reignite inflation. But less than 24 hours later, Sentiment flipped. On Thursday, President Trump said he was canceling planned strikes on Iran as negotiators worked toward a broader agreement.

1:08And stocks soared, with the Dow adding 930 points. Whether the ceasefire holds is an open question. But geopolitics wasn't the only thing driving markets. Investors were also grappling with growing questions about the AI trade and preparing for the largest IPO in history. After all the back and forth, major indexes ended the week slightly higher. The S &P rose 0.65 percent, while the Dow grew 0.66 percent. The Nasdaq gained 0.7 percent.

1:44Recent volatility has also reminded investors of the risks of a top-heavy market. The Nasdaq has swung more than 2 % a day on average over the past week, more than double its typical pace. Chip stocks were at the center of the turbulence. After months of seemingly unstoppable gains, shares in Samsung, SK Hynix, Marvell Technology, and other semiconductor companies whipsawed. The initial sell-off was sparked by concerns that expectations for AI-fueled growth may have become too optimistic. But by the end of the week, many of those stocks rebounded. SK Hynek shares rose nearly 4 % this week, while Marvell Technology gained a little over 6%.

2:25Samsung ended the week roughly 2 % lower. The episode also encouraged some investors to look beyond the AI trade. While chip stocks dominated the headlines, transportation companies, financial firms, and materials producers quietly attracted fresh interest as investors searched for companies with strong earnings growth and less demanding valuations. Among stocks that have hit record highs in recent days are Old Dominion Freightline, which has risen 58 % this year, Ryder System, gained 46%, and logistics firm Madsen added 61%.

3:08There's another reason markets have been so volatile lately, and it has nothing to do with chips, inflation, or the conflict in the Middle East. Investors were preparing for the launch of SpaceX.

3:23And some analysts believe investors have been selling other stocks to raise cash for the offering. The rocket company went public yesterday in the largest IPO ever and immediately became the sixth most valuable U.S.-listed firm, passing Elon Musk's other company, Tesla. Individual investors alone requested more than$70 billion worth of SpaceX shares. The company allocated about 20 % of its shares to retail investors at$135 apiece. Many received only a fraction of the shares they requested. One trader posted that after requesting 450 shares, they were allocated just one. Even if they only got one share, early investors are doing pretty well.

4:04SpaceX shares closed up 19 % in its first day of trading, giving the company a market value of around$2.1 trillion.

4:15And finally, as a native New Yorker, I could not end this week's podcast without shouting out the Knicks. Shares of Madison Square Garden Sports, the publicly traded company that owns the Knicks and the Rangers hockey team, hit a record high during the NBA finals and have more than doubled over the past year. Part of that enthusiasm comes from a proposal to split the Knicks and Rangers into separate companies, potentially unlocking value for shareholders. But analysts say every playoff win is helping too. An Eastern Conference Finals home game can be worth roughly$20 million to the company. And NBA Finals games are worth even more.

4:53Shares in MSG Sports are up more than 52 % so far this year. Which means Jalen Brunson may be one of the few athletes whose clutch shooting is actively moving the stock price.

5:07And now you know what's news in markets this week. You can read about more stocks that moved on the week's news in our live markets coverage on WSJ.com. Today's show was produced by Anthony Bansi with supervising producer Melanie Roy. I'm Imani Moise. Have a great weekend and see you next Saturday.

5:33Not again. Another AI project has ended without any ROI. Close to cracking? Time to meet the Solonis Context Model, which provides AI the operational clarity it needs. Go to CELONIS.com to start getting AI ROI.