US EQUITY OPEN: Risk-on trade post Memorial Day; Semiconductors drive gains, with MU hitting new record high

OPEN:  Stocks open higher after a long weekend due to Memorial Day. Sector upside is led in Tech, Materials, and Industrials, whilst Energy, staples and Healthcare lag. The risk-on mood comes after a deluge of updates over the weekend and on Monday which have leaned on the constructive side regarding US-Iran. A finalised agreement appears days away, with Fars now reporting that the last major disagreement between Iran and the United States over starting negotiations relates to Iran's blocked resources. Lower oil prices have weighed on energy stocks, though US and Israeli jets struck Iranian vessels in the Strait of Hormuz, which has left oil recouping some of Monday's losses. Resilience in the USD is present, strengthening against major peers as yields across the globe ease. The post-Waller hawkish reaction on Friday has seen some fading since, with only 18bps of hikes priced in vs the full 25bps that was seen shortly after he spoke. On AI, semiconductors (SMH +3.4%) see strong gains with Micron (MU, +13.2%) hitting a new record high as optimism builds. Space stocks, AST SpaceMobile (ASTS +16.1%) and Rocket Lab (RKLB +4.4%) see upside after Cantor Fitzgerald d is bullish on the group, citing a USD 90mln contract awarded to Rocket Lab and Intuitive Machines (LUNR +17.3%), reaffirming fiscal year guidance and expecting a contract decision on a Lunar Terrain Vehicle later this week.

STOCK SPECIFICS

• Elbit Systems (ESLT): Earnings beat; won $1.4B EU defence contract.
• Oklo (OKLO): Selected by the DOE for advanced negotiations under the Surplus Plutonium Utilization Program.
• Ferrari (RACE): Unveiled Luce, its first five-seat, four-door fully electric vehicle, priced at $640K.
• Modine Manufacturing (MOD) +18.2%: Signed a long-term agreement to supply more than $4B of Airedale cooling products.
• AutoZone (AZO): Revenue missed.
• Joyy (JOYY): Revenue & guidance beat.
• Cognex (CGNX): Upgraded at JPMorgan to 'Overweight' from 'Neutral'.
• Intuitive Machines (LUNR): Cantor Fitzgerald remains bullish on LUNR following its reaffirmed FY26 revenue guidance.