Key insights
- US equity indexes showed modest gains, buoyed by anticipation of the record-breaking SpaceX IPO. Oil prices pared losses as geopolitical tensions with Iran eased slightly, though uncertainty remains. The market is digesting the massive SpaceX IPO, which could influence tech sector sentiment. Adobe's significant drop due to AI strategy shifts highlights sector-specific pressures, while Magnificent Seven stocks showed mixed performance, with Tesla declining after recent gains.
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Major stock indexes rose Friday ahead of SpaceX's blockbuster IPO. Meanwhile, oil prices pared losses after President Donald Trump said Iranian state media's reported terms of a peace deal bear "no relation to the truth."
The blue-chip Dow Jones Industrial Average, benchmark S&P 500, and tech-focused Nasdaq Composite were a respective 0.6%, 0.3%, and 0.1% higher in recent trading.
Major equities indexes bounced back Thursday, ending sharply higher as oil prices fell following President Donald Trump's announcement that he had called off scheduled military strikes on Iran. The Nasdaq, Dow, and S&P 500 finished a respective 2.5%, 1.9%, and 1.8% higher, with the Dow adding 930 points.
Oil prices dropped yesterday after President Donald Trump called off planned strikes against Iran, and they sank further early Friday on optimism the nations were near a deal to reopen the Strait of Hormuz. However, they pared losses after Trump wrote on Truth Social that "the terms that Iran leaked out to the Fake News have NOTHING to do with the terms that were agreed to, in writing." West Texas Intermediate futures, the U.S. crude oil benchmark, were 1.6% lower at $86.30 a barrel in recent trading, while front-month contracts of Brent crude, the global benchmark, were down 1.4% at $89.10.
Investors are focused today on Elon Musk's SpaceX, which is expected to debut on the Nasdaq under the ticker "SPCX." Officially Space Exploration Technologies, the company yesterday confirmed the pricing of its IPO of 555,555,555 shares at $135 each. The $75 billion raised marks the largest IPO in history. (Read our SpaceX IPO live blog here.)
Shares of the Magnificent Seven tech giants were mostly lower in recent trading. Tesla (TSLA), another one of Musk's companies, was down 1.6% after pacing the septet with a 4.6% advance yesterday.
Adobe (ADBE) sank 7% after executives said its short-term annualized recurring revenue (ARR) growth will be pressured as the company prioritizes its "freemium" AI offerings to grow its user base, and that CFO Dan Durn was leaving. Marvell Technology (MRVL) announced its was hiring Durn to be its finance chief.
Oracle (ORCL) stock, which dropped 8.5% yesterday after the software and cloud-computing giant reported roughly $5 billion more in capital expenditures than expected, was 1% lower.
The 10-year Treasury yield, which influences interest rates on mortgages and other consumer loans, was near 4.50%, up from Thursday's close above 4.47%.
Bitcoin was trading around $63,500, down slightly over the past 24 hours. The U.S. dollar index, which tracks the value of the greenback against a basket of foreign currencies, was 0.1% lower at 99.77. Gold futures rose 2.2% to $4,205 an ounce.
What to Expect From Wednesday's Fed Decision: Flat Interest Rates and a New Direction
The Federal Reserve will have its first meeting under the new management next week, and no one is entirely sure exactly what to expect.
One thing is nearly certain: the central bank is overwhelmingly likely to keep its influential fed funds rate flat for the time being. Financial markets are pricing in a 96% chance the Fed will hold rates steady, according to the CME Group's FedWatch tool, which forecasts rate movements based on fed funds futures trading data.
Beyond that, however, there are many open questions about how Warsh will lead the Fed into its next era.
Anna Moneymaker / Getty Images
Warsh is taking leadership of the Fed at a time when it faces increasing risks to its dual mandate from Congress to keep inflation in check and employment high. The former Fed governor's approach to monetary policy will be tested immediately: the Iran war is pushing up energy prices, threatening to stoke more persistent and widespread inflation.
Read the full article here.
-Diccon Hyatt
SpaceX IPO Today: Live Coverage as the Stock Prepares to Start Trading
SpaceX is ready. Will there be liftoff?
Space Exploration Technologies—Elon Musk's space exploration, connectivity and artificial intelligence company— looks likely to get a warm reception from investors. Its trading debut, set for today, comes after the biggest IPO in history, raising about $75 billion after selling about 556 million shares. The shares sold at $135, as expected, and the stock, flying under the symbol "SPCX," will list on the Nasdaq exchange later today. ("Teams are go for launch," the company wrote on X yesterday in a message confirming the pricing.)
The implied market capitalization of the company, around $1.8 trillion based on the aforementioned numbers, puts SpaceX among the most valuable U.S. companies—ahead of some Magnificent Seven firms—even before trading starts.
Photo by Michael Yanow / NurPhoto via Getty Images
The outsize demand for the offering could set up SpaceX to pop, with investors champing at the bit to get a piece of the space-AI crossover, which has ambitions to build orbital data centers and colonize Mars. On prediction markets, bettors generally expect the stock to rise today, and some envision a rise to, or above, a $3 trillion market cap.
Read the live blog here.
-Crystal Kim and David Marino-Nachison
FanDuel Parent Flutter Entertainment Delisting From London Exchange
Flutter Entertainment (FLUT), the parent company of sports betting giant FanDuel, plans to delist from the London Stock Exchange as of Aug. 3, making its shares available only on the New York Stock Exchange.
The company moved its primary listing to the U.S. about two years ago, and now says it is "in the best interests of the Company and its shareholders" to delist in London.
The company cited the level of trading activity of its London shares, as well as the costs around regulatory and administrative requirements to maintain the London listing.
Flutter's U.S.-traded shares were up less than 1% ahead of the opening bell.
-Aaron McDade
Nic Antaya / Getty Images
Sleep Number Files for Chapter 11 Bankruptcy, To Combine With Sleep Country Canada
Sleep Number (SNBR) has filed for bankruptcy.
In response to mounting debt and falling sales, the Minneapolis-based mattress firm announced Friday it "initiated a voluntary Chapter 11 sale process" in the U.S. Bankruptcy Court for the District of New York, and intends "to combine with Sleep Country Canada to create a leading North American mattress and bedding company."
"While we have made meaningful progress advancing our turnaround efforts and strengthening our operations, our capital structure remains unsustainable," CEO Linda Findley said. "Following a comprehensive review of our strategic options and a robust sale process, we are confident that moving forward with the Sleep Country Canada agreement and this court-supervised sale process will enable us to address our financial constraints."
Sleep Country Canada will serve as the "stalking horse" bidder in a court-supervised sale process, Sleep Number said.
On June 2, Sleep Number said in a regulatory filing that it was providing one-time cash retention bonuses to five executives, including $2.5 million to Findley and $1 million to CFO Amy O'Keefe.
Smith Collection / Gado / Getty Images
Travel Stocks Rise as Oil Drops
Friday's pullback in oil prices is helping shares of companies in the travel space.
Airlines Delta (DAL), United (UAL), and American (AAL) and cruise operators Royal Caribbean (RCL), Carnival (CCL), and Norwegian Cruise Line Holdings (NCLH) all advanced about 1.5% to 2% in premarket trading.
Oil prices fell Friday on optimism the U.S. and Iran were near a deal to reopen the Strait of Hormuz. West Texas Intermediate futures, the U.S. crude oil benchmark, were 3.2% lower at $84.85 a barrel in recent trading, while front-month contracts of Brent crude, the global benchmark, were down 3% at $87.75.
Fuel is the second-biggest cost airlines and cruise companies have, behind just labor.
Joan Valls / Urbanandsport / NurPhoto via Getty Images
Rising Prices and Labor Market Strains Wave Red Flag For The Economy
Two pieces of economic data released Thursday carried a whiff of "stagflation," signaling that inflation could worsen and hinting at weakness in the job market.
The Producer Price Index for final demand, a measure of wholesale prices, rose 1.1% over the month and 6.5% over the 12 months ending in May, the Bureau of Labor Statistics said. That was the largest annual increase in wholesale prices since November 2022 and a warning that businesses will pass those cost increases along to consumers.
Separately, 229,000 people filed new claims for unemployment benefits last week, up 4,000 from the week before and the most since February, the Department of Labor said.
Al Drago/Bloomberg via Getty Images
Together, the reports showed a rising risk that the economy could enter a state of stagflation, or stagnant economic growth combined with high inflation. The PPI report tarnished the silver lining of Wednesday's consumer inflation data, which showed "core" prices outside of food and energy rose less than expected in May despite accelerating overall inflation.
Read the full article here.
-Diccon Hyatt
Futures Rise Ahead of SpaceX IPO
Futures contracts connected to the Dow Jones Industrial Average pointed 0.6% higher.
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S&P 500 futures were up 0.5%.
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Nasdaq 100 futures advanced 0.4%.
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