S&P futures are up 0.2% Friday morning after U.S. equities finished higher Thursday, with quantum computing, most-shorted names, retail favorites, and small caps among the thematic standouts. The S&P 500 is on track for an eighth straight weekly gain, which would be its longest winning streak since 2023. Global tone is firmer, with Japan up more than 2.5% and Europe higher by roughly 0.8%. Treasuries are narrowly mixed with further curve flattening, the dollar is little changed, gold and silver are lower, Bitcoin futures are down 0.7%, and WTI crude is up 2.7% after Thursday’s nearly 2% decline.
The market is quiet heading into the long U.S. holiday weekend. Middle East headlines remain fluid, though the lack of appetite for renewed escalation remains the key positive, even as nuclear issues and Strait of Hormuz access remain unresolved. Rate stabilization has helped sentiment, but investors continue to watch structural upward pressure on yields and the negative rate/equity correlation. AI compute and infrastructure demand remains the dominant market theme, though the related momentum trade has already come a long way. Despite the S&P sitting less than 1% below its all-time high, sentiment appears contained, with hedge fund short positioning elevated and the AAII bull-bear spread back in negative territory. Consumer-facing earnings have mostly supported the consumer resilience narrative, though inflation and affordability pressures remain visible.
Company News
- ROST: Post-earnings standout despite a high bar, helped by a record +17% comp, traction from strategic and merchandising initiatives, and off-price industry outperformance.
- EL: Big gainer after disclosing it ended talks with Puig.
- DECK: Mixed takeaways, with a better Q4 helped by DTC and International strength, offset by scrutiny around FY27 margin outlook and domestic growth.
- WDAY: Strong gainer, with Street positive on an outsized subscription revenue beat, best Q1 new ACV growth in five years, AI traction, and better operating-margin guidance.
- TTWO: Mixed reaction; fiscal Q4 was better and FY27 guidance was below expectations, but the company said GTA VI remains on track for a November 19 release.
- ZM: Beat and raised guidance, increased its buyback by $1B, and highlighted AI monetization.
- IMAX: Reportedly exploring a sale.
U.S. equities finished higher Thursday, reversing earlier losses and ending a bit off best levels, with the Dow +0.55%, S&P 500 +0.17%, Nasdaq +0.09%, and Russell 2000 +0.93%. The macro narrative was driven by renewed U.S.-Iran ceasefire optimism after Saudi media reported a mediated agreement could be announced, including an immediate ceasefire and freedom of navigation in the Strait of Hormuz. The headlines sparked a late Treasury rally, a crude reversal, and slightly softer Fed-hike pricing, though skepticism remains given unresolved nuclear issues and prior reports about Iran pushing for enriched uranium to stay in-country. WTI crude settled down 0.9% to $97.42, reversing earlier gains, while Treasuries were mixed with curve flattening: the 2-year yield rose 2 bp to 4.06%, the 10-year slipped 1 bp to 4.56%, and the 30-year fell 2 bp to 5.09%. The dollar rose 0.1%, gold gained 0.2%, silver rose 0.7%, and Bitcoin futures were little changed.
Economic data were mixed but inflation-sensitive. May flash manufacturing PMI beat expectations and reached its highest level in four years, while flash services PMI came in light and fell to its lowest level since February. The report flagged the steepest rise in input costs since late 2022 and the highest selling-price inflation since August 2022. Employment weakened, with job losses concentrated in services. Initial and continuing claims both came in slightly above expectations, the Philly Fed index unexpectedly turned negative as new orders contracted, and April housing starts and permits both beat. Richmond Fed President Barkin said policymakers have historically looked past supply shocks but need to watch the labor market, consumer spending, and inflation expectations.
Sector performance was mixed but leaned positive. Utilities led, up 1.03%, followed by Consumer Discretionary +0.77%, Materials +0.73%, Healthcare +0.64%, Technology +0.28%, and Financials +0.21%. Real Estate rose 0.12%, and Communication Services was little changed. Consumer Staples was the weakest sector, down 1.63%, pressured by Walmart and Kroger, while Energy fell 1.01% on the oil reversal and Industrials slipped 0.12%. Outperformers included semis/memory, big tech, networking/communications, apparel, multis, pharma/biotech, industrial metals, media, E&Cs, cruise lines, airlines, most-shorted names, small caps, and retail favorites. Laggards included software, machinery, credit cards, staples retailers, grocers, energy, hospitals, trucking, and China tech.
Information Technology
- NVDA: Posted a strong beat-and-raise on continued AI demand. Takeaways were positive on the $200B CPU TAM, new segmentation, and frontier-model share gains, including Anthropic, though expectations were high.
- INTU -20.0%: Fiscal Q3 earnings beat and FY guidance came in ahead, but shares fell on softer TurboTax/Consumer revenue trends tied to price-sensitive DIY filers. The company is also cutting roughly 17% of headcount and taking restructuring charges.
- IBM +12.4%: Confirmed a $1B CHIPS Act award to develop a new quantum chip foundry company.
- APLD +21.5%: Announced a 15-year hyperscaler lease with roughly $7.5B in base-term contracted revenue, extending momentum from its prior Delta Forge 1 agreement.
- INFQ +31.5%: Rose on reports that the U.S. will award $2B to quantum-computing companies in exchange for equity stakes. Infleqtion received a Commerce Department letter of intent for $100M in funding.
- Anthropic / MSFT: Anthropic will rent servers using Microsoft AI chips. Separately, Anthropic revenue is projected to more than double to $10.9B in Q2 and reach its first operating profit.
Communication Services
- SPOT +13.1%: Announced longer-term guidance at its first Investor Day since 2022.
- China tech: Lagged as broader risk appetite remained uneven and investors continued to rotate within growth.
Consumer Discretionary
- AAP +14.4%: Q1 revenue, comps, and EPS beat, largely driven by better-than-expected margins. DIFM was the standout, while DIY returned to positive growth; FY26 guidance was reaffirmed.
- RL +13.9%: Fiscal Q4 earnings and revenue beat, with comps ahead across all geographies. Margins benefited from mix and lower cotton costs, the dividend was increased, and FY27 guidance assumes margin expansion.
- KTB +6.6%: Agreed to sell the Lee business to Authentic Brands Group for up to $1B.
- ELF +4.7%: Fiscal Q4 earnings and revenue beat, helped by Rhode strength, retail demand, and new launches. FY27 guidance was below Street expectations due to inflation pressures, and the company is taking targeted pricing actions to drive unit growth.
- URBN +2.9%: Q1 EPS and revenue beat, with Urban Outfitters and Free People offsetting an Anthropologie miss. Gross and operating margins were ahead of expectations.
- CHH: Announced its CEO will step down while reaffirming FY guidance.
Consumer Staples
- WMT -7.3%: Q1 revenue beat, but EPS was in line and operating income was hit by a 250 bp fuel-cost impact. Gross margin and operating margin were light, SG&A was higher than expected, and Q2 EPS guidance came in below Street expectations.
- KR -2.3%: New CEO told Bloomberg the company plans major price cuts to regain share from Walmart, Costco, and other competitors.
- FRPT +6.1%: Announced a $150M share repurchase authorization.
Energy
- Energy sector -1.01%: Underperformed as crude reversed earlier gains and settled lower on renewed ceasefire headlines.
Financials
- Credit cards: Lagged within Financials, though the sector still finished modestly higher.
- Financials +0.21%: Benefited from the broader late-day market reversal but was not a major leadership group.
Healthcare
- LLY +2.2%: Announced topline TRIUMPH-1 obesity-drug results that met primary and secondary endpoints, with patients losing 28% of body weight after 80 weeks on average, exceeding typical loss for Zepbound and Novo Nordisk’s Wegovy.
- Hospitals: Lagged within Healthcare, while pharma/biotech and MedTech outperformed.
Industrials
- DE -5.2%: Fiscal Q2 earnings and revenue beat, with Construction & Forestry a standout, but Production & Precision Ag was weak. FY net income guidance was reaffirmed, while price-realization guidance was lowered in some segments.
- CARR -2.2%: Fell after reports that the Trump administration will roll back Biden-era regulations on hydrofluorocarbons/refrigerants; separately, director Max Viessmann disclosed a large share sale.
- E&Cs / airlines / cruise lines: Outperformed as risk sentiment improved into the close.
Materials
- USAR +7.6%: Selected for Department of Energy funding under the Critical Materials Innovation Program, with total project value above $50M.
- Industrial metals: Outperformed, helping Materials gain 0.73%.
Real Estate
- AVB / EQR: Confirmed an all-stock merger.
- Real Estate +0.12%: Finished modestly higher as the late-day Treasury rally helped rate-sensitive equities.
Utilities
- NBIS +14.7%: Announced a Master Fuel Cell Capacity agreement with Bloom Energy for guaranteed capacity of roughly 250 MW and installed capacity of about 328 MW, with monthly service fees of up to $2.6B.
- Utilities +1.03%: Led the market, helped by defensive demand and AI-power infrastructure themes.
Data sourced from FactSet Research Systems Inc.
