The IPO Buzz: All Eyes and Ears on the Fed

For Wall Street, it’s all about the Fed today. The focus is on what Fed Chairman Jerome Powell will say at his news conference at 2:30 p.m. EDT. A rate increase of 0.75 percent is expected. As for IPOs, one tiny biotech deal and one micro-cap NASDAQ uplisting deal are set to price tonight. Two other small-cap deals may also get done this week.

“75-basis-points (hike) is a done deal,” a veteran IPO pro says of the Fed’s anticipated bump up in the key fed funds rate. The prospects for a full-percentage-point increase “were taken off the table last week,” he adds.

The Fed’s rate announcement is due at 2 p.m. EDT today (Wednesday, July 27, 2022) at the end of the FOMC’s two-day meeting.

“What Powell says is critical,” the IPO pro says. “That always moves stocks. There’s a feeling on the Street that they’re (the Fed) going to temper their remarks. They’ll say inflation is getting better, commodity prices are coming in, but we’re going to be vigilant.”

The Fed writes the script for Wall Street, as IPOScoop founder John Fitzgibbon has often said. If the Fed indicates that the economy is on the right track, that outlook creates a friendly climate for the broad U.S. stock market – and IPOs. If the Fed signals any concerns, that view creates uncertainty and gives investors a reason to sell some stocks or stay in cash.

U.S. stocks rallied at today’s open, sending the Dow and the NASDAQ both up over 100 points while the S&P 500 added about 30 points, in anticipation of the Fed’s rate move and some relief over Alphabet and Microsoft earnings after Tuesday’s close.

If investors look a little windblown, it’s understandable. It’s one of the busiest weeks of the year for S&P500 earnings – along with the Fed and plenty of data to digest.

IPOs in Summer Lite Mode

As for the IPO market, it’s a light summer week in the slowest year since 2009. On tap for pricing tonight are two micro-cap deals:

  • MAIA Biotechnology (MAIA proposed) – an NYSE – American IPO of a cancer biotech – ThinkEquity is the sole book-runner.
  • Nocera Inc. (NCRA proposed) – a NASDAQ uplisting – a unit deal of the Nevada parent of a Taiwan-based aquaculture systems company – Spartan Capital and Revere Securities are the joint book-runners.

Thursday night’s pricing roster calls for Onfolio Holdings (ONFO proposed), a small-cap unit IPO with EF Hutton as the sole book-runner, and possibly Mobile Global eSports, Inc. (MGAM proposed), a micro-cap IPO with WestPark Capital as the sole book-runner. (Please see the IPO Calendar and the IPO Profiles of these companies for details.)

The SEC’s filing window is still fielding a steady stream of mostly small-cap IPOs and uplistings. (Check out the IPO Pipeline.)

Next week’s IPO Calendar carries just a few deals – another week of life in the slow lane.

Stay tuned.

(For more information about these companies, please check the IPO Calendar and the IPO profiles found on the website.)

Note: Never trade on proposed symbols. They have been known to change and you might buy something on the OTC Bulletin Board.

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Disclosure: Nobody on the staff has a position in any stocks mentioned above, nor do they trade or invest in IPOs. The staff does not issue advice, recommendations or opinions.

Disclaimer: A SCOOP Rating (Wall Street Consensus of Opening-day Premiums), is a general consensus taken, at press time, from Wall Street and investment professionals concerning how well an IPO might perform when it starts trading. The SCOOP Rating does not reflect the opinions of anyone associated with The SCOOP ratings should not be taken as investment advice. The rating merely reflects the opinion of the professionals at the time of publication and is subject to last-minute changes due to market conditions, changes in a specific offering and other factors, such as changes in the proposed offering terms and the shifting of investor interest in the IPO. The information offered is taken from sources we believe to be reliable, but we cannot guarantee the accuracy.