Tonight Highlights | Oil Hits $103 ; U.S. Futures Slump

 

Wall Street's optimism began to cool on Thursday, with the three major U.S. stock index futures trending lower alongside a general decline in major European indices.

 

Anxiety intensified among traders due to the slow diplomatic progress between the U.S. and Iran and heightened tensions in the Strait of Hormuz. Brent crude surged for the fourth consecutive session, briefly rising above $103 per barrel.

 

In Wednesday's session, both the S&P 500 and the Nasdaq had closed at record highs, buoyed by news that President Trump had extended the ceasefire with Iran.

 

However, geopolitical relations remain strained. Reports indicate that U.S. Vice President JD Vance has suspended his travel to participate in peace talks, citing a lack of commitment from the Iranian side.

 

Iranian state media also reported that their negotiators would not attend the talks, calling discussions with the U.S. a "waste of time." Furthermore, the Iranian Navy stated on Wednesday that it had seized two container ships in the Strait of Hormuz.

 

Despite these headwinds, a robust earnings season continues to support investor sentiment. Of the 87 S&P 500 companies that have reported results thus far, 81% have exceeded earnings expectations, while 76% have topped revenue estimates.

 

Julie Biel, Chief Market Strategist at Kayne Anderson Rudnick, noted that while high-impact headlines are causing hesitation and anxiety, upward revisions to earnings forecasts suggest that companies are finding ways to navigate the noise and uncertainty to achieve profit growth.

Corporate Highlights

Tesla (TSLA): Shares fell over 3% pre-market as CEO Elon Musk warned of a "massive" increase in capital expenditure to support the company’s pivot toward AI-driven autonomous vehicles and humanoid robots. Tesla also announced a $2 billion acquisition of an AI hardware firm and slated the production of its third-generation Optimus robot for July-August 2026.

 

SK Hynix: The company announced plans to provide HBM4E samples to customers in the second half of this year, aiming for mass production in 2027. It expects HBM demand to far exceed its capacity for the next three years.

 

SpaceX: The company estimated its total addressable market (TAM) at $28.5 trillion, with over 90% ($26.5 trillion) expected to be driven by AI.

 

SoftBank: Reports suggest SoftBank is seeking a $10 billion margin loan using its stake in OpenAI as collateral to fund its ongoing AI investments.

 

Microsoft: Announced its largest-ever investment in Australia—$18 billion (AUD 25 billion)—for AI infrastructure, cybersecurity, and skills training through 2029.

 

Google Cloud: Formed a strategic partnership with private equity giant CVC to accelerate "Agentic AI" transformations across CVC’s portfolio companies using Gemini models.