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SpaceX stock snapped a painful seven-day losing streak on Tuesday. A warning to short sellers from Elon Musk might have helped.
Shares of his rocket and AI company traded as high as $129.88 before closing at $123.54, up 3.1%, while the S&P 500 and Dow Jones Industrial Average rose 0.9% and 0.7%, respectively.
The move came after a few things for investors to digest. For starters, SpaceX scrubbed another rocket flight on Monday. A Falcon 9 launch carrying 24 Starlink satellites was aborted before takeoff. SpaceX said the payload was safe.
Aborts can happen. This one happened just after SpaceX scrubbed its 13th Starship test after encountering an engine issue before launch. The test flight is now slated for July 23.
SpaceX has flown its Falcon 9 hundreds of times, completing more than 80 launches so far in 2026. Starship is still in development. The huge, fully reusable rocket is designed to cut the cost of reaching orbit by about 90% relative to a Falcon 9. Those lower costs will enable SpaceX to do things such as build AI data centers in space.
Later on Monday, CEO Elon Musk warned short sellers, posting on X that the survival probability of firms that borrow SpaceX stock and bet on price declines is low.
Currently, about 17% of SpaceX shares available for trading have been sold short. That is a very high percentage for a large tech company. The percentage for Apple is about 1%.
Part of the reason for the high short interest in SpaceX stock is that there are only a few shares available to trade. Most SpaceX stock is still held by early investors who are restricted from trading. More stock is going to become available to trade after SpaceX reports second-quarter numbers on Aug. 4.
One of the reasons SpaceX stock has been weak recently is the fear that those early investors will take profits when they are allowed to sell.
Coming into Tuesday trading, SpaceX stock had declined for seven consecutive days, losing 21% over the span. Shares were down about 47% from their all-time high of almost $226 a share, and have closed below the $135 IPO price for three consecutive days.
A successful Starship test might help the stock. So could earnings. High short interest raises the chance of a short squeeze, when bearish investors rush to buy stock, raising prices, creating the need to buy even more stock to limit losses.
Short covering after Musk’s warnings could be helping shares on Tuesday. Investors might also be reading a report from Macquarie analyst Paul Golding. He wrote Monday that recent prices represent a “compelling entry point.” Golding rates shares Buy and has a $250 price target. The average analyst price target for SpaceX stock is about $241, according to FactSet.
Early trading in SpaceX stock has been wild. The volatility isn’t likely to end soon.
Write to Al Root at [email protected]