The Scottish Mortgage Investment Trust share price has extended its rebound, climbing more than 7% from its November 5 low and reaching its highest level since late October. The bounce comes as the trust’s largest holdings face a mix of valuation resets and operational headwinds, leaving investors to weigh whether the recovery is sustainable or merely a technical pause.
Anthropic’s IPO valuation cut pressures the trust
One of the most immediate challenges is Anthropic, which accounts for 4.2% of the portfolio. The AI company is preparing to go public as soon as this month, but its expected valuation has been slashed from an initial $2 trillion target to around $1.3 trillion, according to the Wall Street Journal. Bankers are reportedly pushing for a valuation above $1.5 trillion, but the reduction reflects broader jitters in the AI sector.
For Scottish Mortgage, an IPO at $1.3 trillion would still represent a substantial return on its stake, but it would fall short of earlier expectations. Historical patterns also suggest that newly listed companies often surge shortly after their debut before retreating, a trend seen with recent names like Bullish and Gemini Space Station.
SpaceX remains in a bear market
SpaceX, the trust’s biggest holding, continues to weigh on performance. After an initial post-IPO rally, the stock has plunged more than 36% from its 2025 high and remains in bear market territory. The decline is tied to ongoing AI-related volatility that has also hit other companies such as Nebius and CoreWeave. SpaceX has also been borrowing heavily to fund its AI ambitions, including a recent $40 billion raise to purchase Nvidia chips.
Other portfolio companies under pressure
Beyond SpaceX and Anthropic, several other key holdings have retreated. Taiwan Semiconductor Manufacturing (TSMC), which represents 6.4% of the portfolio, has fallen nearly 20% from its peak despite accelerating revenue growth. Nvidia, another major position, is down over 30% from its high, with recent selling exacerbated by reports linking CEO Jensen Huang to an alleged Chinese spy. Investors worry the controversy could threaten his leadership.
MercadoLibre, a Brazilian e-commerce giant, has dropped sharply following the presidential election in which President Lula defeated Flavio Bolsonaro. Shares fell to $1,490, down from a year-to-date high of $2,340. Other notable holdings like Shopify, Amazon, ASML, and PDD Holdings have also struggled recently.
Technical support and what’s next
The recent rebound can be explained by technical factors. The stock bounced after hitting a low of 1,420p, a level that coincided with the lowest swings in March and July this year, as well as the 200-day exponential moving average. Such confluence often attracts buyers.
However, the recovery follows a sharp decline between October 12 and November 5, raising the possibility that this is merely a pullback within a broader downtrend. If the rally continues, bulls may target the psychological 1,600p level. Conversely, a break below the ascending trendline could signal further downside.
This article is for informational purposes only and does not constitute financial advice.
