US EQUITY OPEN: US indices gain amid risk-on sentiment as Middle East rhetoric appears more constructive

OPEN: US indices opened with gains amid risk-on sentiment given some of the encouraging reporting around the US/Iran war, albeit assets have come off extremes amid some Iranian pushback. Risk sentiment drastically improved as Axios, citing officials, said US and Iran are reportedly closing in on one-page memo to end war. Highlighting the size of the moves, Brent reversed to a trough of USD 96.75/bbl from a peak of USD 109.02/bbl, and currently sits around USD 103.50/bbl after the Iran rebuttals. As such, focus resides around any further updates, which we will for sure get, as US seems to want to avoid any restarting of wide spread strikes, but Trump did threaten “If they don't agree, the bombing starts, and it will be, sadly, at a much higher level and intensity than it was before”. Stellar AMD and SMCI earnings are driving tech gains, with GOOGL also buoyed by a USD 500bln Anthropic investment. Sectors are mainly in the green with Materials and Communications outperforming, with the latter boosted by aforementioned GOOGL, while Energy lags as crude benchmarks are lower by c. USD 6/bbl. The Dollar is lower, while precious metals and Treasuries surge given risk-on tone as all G10 FX gains vs. the Buck, with Antipodeans and Yen outperforming. For Treasuries, in the QRA, auction sizes were maintained as expected with guidance also unchanged, but TBAC minutes hint at potential guidance adjustment as soon as the next refunding announcement. Data has taken a back seat, but ADP jumped to 109k from 62k, much above the expected 79k, ahead of US payrolls on Friday.

STOCK SPECIFICS:

• AMD (AMD): EPS & rev. beat w/ better than exp. guidance driven by accelerating data centre growth & strong demand for processors and GPU shipments
• Super Micro Computer (SMCI): Profit beat w/ stellar next Q & FY outlook as demand for AI servers remained robust
• Corning (GLW) announced long-term partnership w/ NVDA to strengthen US manufacturing for AI infrastructure.
• Anthropic committed to spend $200bln w/ Google Cloud (GOOGL) over 5yrs under recent agreement
• Occidental Petroleum (OXY): Rev. light & lowered FY26 production outlook.
• Novo Nordisk (NVO): Net sales, EBIT & Wegovy sales all beat.
• CVS Health (CVS): Top & bottom-line surpassed Wall St. exp. alongside lifting FY profit view
• Cencora (COR): Q metrics light
• Disney (DIS): Solid Q report
• Uber (UBER): Stellar outlook offsets quarterly metrics
• GlobalFounrdries (GFS) upgraded at Susquehanna to 'Positive' from 'Neutral'
• Arista Networks (ANET): Q1 metrics beat, as did guidance, but persistent supply constraints, near-term growth challenges & steep valuation prompted investors to step back.