Mega AI IPOs Could Create Short-Term Pressure on Markets, Standard Chartered Says

A wave of highly anticipated initial public offerings from leading artificial intelligence companies could create short-term challenges for financial markets, according to Steve Brice, Global Chief Investment Officer of Wealth Solutions at Standard Chartered.

Speaking on CNBC’s Access Middle East program, Brice said that major listings expected from Anthropic, OpenAI, and SpaceX may temporarily pressure markets as investors absorb the enormous amount of capital likely to be attracted by these offerings.

AI IPO Wave Could Test Market Liquidity

According to Brice, the sheer size of these upcoming IPOs may create “digestion challenges” for investors and financial markets.

While market participation often broadens during periods of significant public offerings, the process is rarely smooth. Large IPOs can temporarily divert capital away from other areas of the market as investors reposition portfolios to participate in new opportunities.

Brice suggested that this adjustment period could generate increased volatility in the near term.

Standard Chartered Remains Cautious

Despite maintaining a constructive long-term outlook, Brice indicated that he is not overly optimistic about market performance in the immediate future.

He noted that equity markets could experience weakness during the summer months, particularly as investors continue to monitor geopolitical developments in the Middle East.

The combination of elevated valuations, large IPO activity, and geopolitical uncertainty may create a more challenging environment for risk assets over the coming months.

Any Pullback Could Become a Buying Opportunity

While acknowledging the potential for short-term weakness, Brice emphasized that any market correction may ultimately create attractive entry points for long-term investors.

Historically, periods of temporary market volatility have often provided opportunities for investors willing to maintain a longer investment horizon.

As a result, Standard Chartered does not view potential market weakness as a reason to abandon equities entirely.

U.S. Economic Data Could Support Sentiment

Brice also pointed to upcoming U.S. labor market data as a potential source of support for investor sentiment.

Strong employment figures could reinforce confidence in the resilience of the U.S. economy and help offset concerns related to IPO activity and geopolitical tensions.

However, he cautioned that economic conditions could become more challenging if energy market disruptions persist through the end of the summer.

Strait of Hormuz Remains a Key Risk

One of the biggest concerns highlighted by Brice is the ongoing disruption surrounding the Strait of Hormuz, one of the world’s most important energy shipping routes.

Oil prices have climbed sharply amid the Trump administration’s blockade of Iranian ports and the continued closure of the strategic waterway by Tehran.

These developments have increased concerns about global energy supplies and broader economic stability.

Energy Inventories Are Falling Rapidly

Brice warned that inventories are being depleted at an accelerating pace across several critical sectors.

The decline is not limited to crude oil inventories but also extends to petrochemicals, urea, and other essential industrial inputs used throughout global manufacturing supply chains.

If supply disruptions continue, higher energy and production costs could eventually weigh on economic growth and corporate profitability worldwide.

For now, investors remain focused on the balance between strong economic fundamentals, upcoming AI IPOs, and geopolitical risks that could shape market performance in the second half of the year.