The stock market has been facing some major challenges since the start of 2022 due to the recent macroeconomic headwinds, including skyrocketing inflation, a war in Europe, and the Federal Reserve’s hawkish stance to fight inflation. As a result, the major U.S. indexes were pushed into correction territory earlier in the year.
Furthermore, concerns surrounding the resurgence of COVID-19 cases and 40-year inflation rates have caused space companies to incur hefty losses and depressed revenues in the past quarters. This has led to stretched valuations of most stocks and triggered a major sell-off in space stocks. Given their weak financials and bleak growth prospects, these satellite companies are not well-positioned to withstand the current market gyrations. The bearish investor sentiment surrounding the space industry is evidenced by the ARK Space Exploration & Innovation ETF’s (ARKX) 12.6% decline over the past year.
