NEW YORK CITY, New York: SpaceX will join the Nasdaq 100 index on July 7, a move expected to trigger billions of dollars in passive investment as index-tracking funds add shares of Elon Musk's rocket and AI company to their portfolios.

Nasdaq confirmed on June 26 that SpaceX will be included in the technology-focused index following its public debut on June 12. Companies added to major indexes typically benefit from increased demand as exchange-traded funds (ETFs) and mutual funds that track the benchmark are required to buy their shares.

To attract more companies seeking U.S. listings, Nasdaq, along with index providers FTSE Russell and MSCI, has relaxed certain eligibility requirements, including profitability, the waiting period after an initial public offering, and the amount of shares available for public trading.

SpaceX, which began trading on Nasdaq on June 12, has fluctuated between profits and losses over the past three years. The company reported a net loss of US$4.9 billion last year.

OpenAI and Anthropic, two leading developers of large language models, are also expected to pursue initial public offerings this year or next year, with valuations that could exceed $1 trillion.

Popular investment funds such as Invesco's QQQ and QQQM track the Nasdaq 100, giving investors broad exposure to the index's largest non-financial companies.

J.P. Morgan estimates that SpaceX's addition to the index could generate about $4.3 billion in passive inflows.

"Clearly, there's a lot of demand; that's why they fast-tracked the integration into the index," Morningstar Chief Equity Market Strategist Michael Field said. "A lot of people will be happy with it. Some fund managers are less so, the skeptics amongst them, us included. We think the stock is overvalued."

While Nasdaq has moved quickly to include SpaceX, S&P Global said this month it is not changing its requirements for entry into its major indexes, including the benchmark S&P 500. The index provider said it would wait at least 12 months before considering the company for inclusion.