Futures are positive and at session highs even as the a lack of a US / Iran deal pushes oil prices, bond yields, and volatility higher. As of 8:00am ET, S&P futures are up 0.3% to a new all time high of 7620; Nasdaq futures rise 0.2%: the Computex AI Conference kicked off;biggest news is NVDA to enter PC space with a new chip challenging AMD / INTC, helping send its stock up 2.3%.Microsoft shares gain 3.1% after Jensen Huang dismissed concerns over disruption from artificial intelligence. Geopolitics was in focus: in addition to a lack of a deal, there were renewed "kinetic skirmishes" that made headlines. Aside from Tech, Energy is the only sector seeing a uniform bid with elements of both Cyclicals and Defensives weaker highlighting concentration risk. WTI is above $91 as the Energy complex is rallying with Ags catching a bid and Metals mixed as Copper / Silver lead. USD is higher after 2 weeks of losses with bond yields 2 - 3bps. In equities, tech is leading with strength in Mag7 and Semis. Today’s macro data focus is on ISM-Mfg with ISM-Srvcs on Weds and NFP on Friday.

In premarket trading, Nvidia (NVDA) is up 2.3% after the leader in AI chips said it was entering the PC market with a new chip. The news is supporting chip-design company Arm, whose ADRs (ARM) are up 13%, while weighing on chipmakers in the CPU space, with Intel (INTC) down 6%, Qualcomm (QCOM) sinking 9.7%, and AMD (AMD) down 4.3%. Other Mag 7 names are mixed (Meta Platforms +0.3%, Amazon -0.5%, Apple -0.7%, Alphabet -0.8%, Tesla -1.5%).

In other corporate news, Revolution Medicines’s experimental pancreatic cancer drug daraxonrasib delayed painful symptoms for months, in addition to nearly doubling survival.

Traders are waiting for signs that a deal that would reopen the Strait of Hormuz remains on track after Israel stepped up its offensive against Iran-backed Hezbollah in Lebanon over the weekend. Tehran struck a Kuwaiti air base, while the US conducted “self-defense strikes” on Iranian radar and command-and-control sites. Lack of resolution pushed Brent 2.8% higher to nearly $94 a barrel, snapping a three-day run of losses.

The two sides also exchanged messages seeking amendments to a draft agreement. President Donald Trump urged calm, saying the situation will work out well. Iran said Israel’s attacks on Lebanon were preventing a deal.

“Markets need an agreement to open the Strait of Hormuz, to provide the next leg higher in equities and lower in rates,” Jefferies strategist Mohit Kumar told clients. “We still believe that we should get a leg higher when a deal is finally agreed upon.”

Overnight, Nvidia kept the AI trade alive as a stream of headlines emerge from Taiwan’s Computex event. Nvidia has entered the PC market with a new chip, RTX Spark Superchip, aimed at loosening the stranglehold of Intel technology in that arena. Nvidia also said Anthropic, OpenAI and SpaceX are among the first big users of its upcoming microprocessor Vera. The news is supporting chip-design company Arm, whose ADRs (ARM) are up 13%, while weighing on chipmakers in the CPU space, with Intel (INTC) down 6%, Qualcomm (QCOM) sinking 9.7%, and AMD (AMD) down 4.3%. Other Mag 7 names are mixed (Meta Platforms +0.3%, Amazon -0.5%, Apple -0.7%, Alphabet -0.8%, Tesla -1.5%).

“The rally in tech stocks is coherent when one looks at the earnings and profits of both the supplier of AI infrastructure and the hyperscalers,” said Mabrouk Chetouane, head of global market strategy at Natixis Global Asset Management. “There are those who claim there’s a bubble, but I simply see rising profits and a super cycle.”

Meanwhile, the benchmark SOX Index is set for its best quarter ever, soaring 69% in the past two months. Hedge funds have been leaning into market momentum — the cohort was a net buyer of US stocks for a second consecutive week,with purchases reaching their fastest pace in six months, according toGoldman Sachs’ Prime desk.

It is a quiet week on the earnings front, and traders’ focus will shift to a busy macro slate. Today’s manufacturing PMI from S&P Global and ISM might reflect a rush to stockpile goods ahead of potential price increases sparked by the Iran war, while April figures for construction spending could offer a read on the pace of AI data center buildout. Jobs week is coming up, with a slate of indicators on the labor market culminating on Friday with the government’s official report on employment for May,for which Bloomberg survey estimates payrolls to rise by 89,000.

Source: ZeroHedge News