Reddit closes nearly 50% higher on 1st trading day in latest sign IPO market heating up

Reddit CEO Steve Huffman is wearing a sports and a button down shirt. He is holding a hammer to ring the gold bell at the center of the picture. Also in the background is Reddit's mascot, Snoo. (Credit: Spencer Platt/ Getty Images)

On the heels of Astera Labs’ successful IPO, Reddit shares skyrocketing 48% to close above $50 may incentivize other companies that are considering their own public offerings, experts told Fortune.

“Reddit and Astera are both strong green lights for the IPO market picking up. This has been something that we’ve been predicting,” Matt Kennedy, senior IPO strategist at Renaissance Capital, a provider of pre-IPO research that manages two IPO-focused ETFs, told Fortune. “We’ve had rate cuts on the horizon, stock market all-time highs—really strong debuts from tech IPOs has been the missing piece of the puzzle.”