US EQUITY OPEN: Indices push higher amid more constructive Middle East developments

OPEN: US indices opened with gains as all sectors, aside from Energy, reside in positive territory amid more constructive geopolitics as Trump said they are negotiating with Iran, and a victory will happen very soon, while he added they will declare total victory in two weeks. Consumer Discretionary and Communications are the sectoral outperforms, while Energy is hit by losses of c. USD 3/bbl in benchmarks ahead of EIA STEO and private inventory metrics after hours. In terms of stock specifics, Qualcomm has reversed pre-market strength as desks circulate a video of Nvidia CEO Huang telling people to buy the stock is AI-generated. Fed is on blackout, while US balance of trade for April was a marginally deeper deficit than expected, albeit not as large as March’s. Elsewhere, G10 FX is broadly firmer against the Dollar given the risk sentiment, as Kiwi and Pound outperform. Yen lags with USD/JPY continuing to hover around 160, as traders await next week’s BoJ. Treasuries are gaining across the curve ahead of 3yr note auction, with precious metals (XAU, XAG) also seeing strength. Ahead, traders await US inflation data this week ahead of the FOMC next Wednesday. 

STOCK SPECIFICS:

• FedEx (FDX) raised annualised div. rate 5% to USD 4.88/shr, following one-time adjustment related to the spin-off of FedEx Freight (FDXF)
• GSK (GSK) agreed to acquire Nuvalent (NUVL) for USD 10.6bln (or USD 124/shr in cash); closed Mon. at USD 88.49/shr
• J.M. Smucker (SJM): EPS & rev. topped w/ FY profit view better than exp.
• Applied Digital (APLD) signed a 15yr lease with a US-based hyperscaler at its Delta Forge 2 site which is exp. to generate $5.2bln in rev.
• AstraZeneca (AZN) Oral GLP-1 receptor agonist elecoglipron achieved average body weight reduction of 10.5% at 26 weeks
• Applied Materials (AMAT) raised quarterly div. ~15% to USD 0.53/shr.
• SailPoint (SAIL) issued disappointing FY guidance.
• Vail Resorts (MTN): Profit light.
• Reddit (RDDT) received positive comments from Piper Sandler and Cleveland.