4:20pm: Investors dial back risk
Stocks pulled back on Wednesday, retreating from record highs as fading hopes for a quick diplomatic breakthrough between the United States and Iran prompted investors to take some risk off the table.
The Dow Jones led the declines, falling 621 points, or 1.2%, to close at 50,687. The S&P 500 shed 56 points, or 0.7%, to 7,554, while the Nasdaq Composite dropped 240 points, or 0.9%, to 26,854.
The selloff snapped a recent winning streak for major indexes, which had entered the session at or near all-time highs. Investor sentiment weakened as hostilities in the Middle East escalated and optimism faded for a near-term agreement between Washington and Tehran.
Energy markets were a major focus throughout the day. Crude oil prices continued to climb, raising concerns about the potential impact of higher fuel and transportation costs on inflation and economic growth.
At the same time, stronger-than-expected labor market data pushed Treasury yields higher, adding pressure on equities.
Investors now turn their attention to earnings reports due after the closing bell from Broadcom and CrowdStrike, with results expected to provide fresh insight into enterprise technology spending, cybersecurity demand and the ongoing AI investment cycle.
3:50pm: Proactive news headlines
- Medicus Pharma (NASDAQ:MDCX) submitted a Phase 2b study protocol for SkinJect to the FDA, advancing the therapy toward registrational development for patients with the rare genetic disorder Gorlin Syndrome.
- Gunnison Copper Corp (TSX:GCU, OTCQB:GCUMF, FRA:3XS0) completed a bought-deal financing that raised approximately C$34.5 million to help fund development of its Arizona copper project.
- Trust Stamp Inc (NASDAQ:IDAI, ISE:AIID) was selected by Ridgedale Federal Credit Union to provide real-time driver's license verification services through the AAMVA DLDV system to strengthen identity authentication and fraud prevention.
- M2i Global Inc (OTC:MTWO) said the value of its Australian copper agreement has climbed to $1.17 billion as rising copper prices driven by electrification and AI infrastructure demand continue to boost the deal's worth.
- Digi Power X Inc (NASDAQ:DGXX, FRA:1NQ0, NEO:DGX) committed $35 million to acquire Nvidia’s next-generation Vera Rubin systems as it expands its NeoCloudz GPU-as-a-Service platform and AI data center capabilities.
- Silver Range Resources Ltd (TSX-V:SNG, OTC:SLRRF, FRA:8SR) reported encouraging drilling results from partner Excalibur Metals at the Bellehelen project in Nevada, including high-grade silver and gold intercepts that suggest mineralization remains open at depth.
2:45pm: Market movers
- FingerMotion announced plans to expand into edge AI inference computing by developing modular facilities for localized AI processing, positioning the initiative as a natural extension of its existing telecom and technology operations.
- Navitas Semiconductor saw its shares jump about 26% after highlighting its role in Nvidia's AI data center ecosystem and next-generation 800 VDC power architectures at a partner event in Taipei.
- GitLab beat first-quarter revenue and earnings estimates but announced a restructuring plan that includes cutting about 14% of its workforce and reducing its geographic footprint, sending shares lower.
- Ulta Beauty Inc (NASDAQ:ULTA) topped first-quarter expectations and raised its fiscal 2026 earnings outlook, though investors reacted negatively to what was viewed as only a modest increase in guidance.
- M2i Global Inc (OTC:MTWO) said the value of its Australian copper agreement has risen to $1.17 billion as surging copper prices driven by electrification and AI-related demand boost the deal's worth.
1:10pm: Alphabet increases private placement
Alphabet Inc (NASDAQ:GOOG) has increased the size of its previously announced equity financing package, lifting the total potential raise to $84.75 billion from an earlier target of $80 billion.
The updated structure includes a mix of public share sales, preferred depositary offerings, a private investment, and a planned at-the-market (ATM) program. The increase reflects higher participation across components of the deal as Alphabet expands funding for data centers and AI-related capital expenditures.
In the public offerings, Alphabet is selling approximately $18 billion of Class A and Class C common stock combined, up from $15 billion previously planned. The company also upsized its depositary share offerings to $16.75 billion, compared with an earlier $15 billion target.
Alphabet is additionally maintaining a previously announced $40 billion ATM program, which would allow it to issue shares over time depending on market conditions.
12:05pm: SpaceX IPO days away
SpaceX is days away from what would be the largest initial public offering in history, and, predictably for an Elon Musk company, it is doing things differently.
Rather than following the conventional playbook, where companies announce a price range, spend weeks on investor roadshows, and set a final price based on demand, SpaceX has opted for the highly unusual approach of setting a fixed price of $135 per share ahead of presentations to investors and formal bookbuilding.
The company is targeting a raise of $75 billion, selling 555.6 million shares, at a valuation of at least $1.8 trillion.
11:00am: Private payrolls post strongest gain in 16 months
U.S. private-sector employment increased by 122,000 jobs in May, topping economists' expectations of 117,000 and marking the strongest monthly gain in 16 months, according to ADP.
The report points to continued resilience in the labor market ahead of the government's closely watched nonfarm payrolls report due Friday.
Bill Adams, chief economist at Fifth Third Bancorp, said the ADP figures showed a "nice moderate increase" in private employment and broadly matched expectations.
The data arrives as investors weigh the potential economic impact of higher tariffs and escalating tensions involving Iran. Adams noted that financial markets are focused on the risk that inflation shocks stemming from the conflict and trade policies could prompt the Federal Reserve to raise interest rates.
However, he suggested that outcome would likely require a prolonged disruption to oil supplies through the Strait of Hormuz.
"If the inflation shocks from the Iran War and tariffs fade, job growth will likely hold at its current pace," Adams said.
10am: Red start for Wall Street
US stocks have opened lower, with tech stocks at the heart of the decline.
The Nasdaq and Dow Jones both fell 0.6% in the opening half-hour, while the S&P was down less than 0.5% and the smaller cap Russell 2000 dropped 0.8%.
Among the biggest fallers on the Nasdaq 100 were Atlassian, Datadog, Palo Alto Networks, Zscaler, Palantir and Arm Holdings.
This tech weakness extended to the Dow, where IBM (down 6.7%), Salesforce (-4%), Nvidia (-2.35%), Microsoft (-2.2%) and Cisco (-2.2%) were among the biggest drags, alongside Goldman Sachs and Boeing.
Top risers on the S&P were defensive and value names, such as Medtronic and ResMed, though there was some tech including Intel and Western Digital, and cyclicals like General Motors.
8.15am: Dow futures down and Nasdaq up
US stocks are set for an uneven start on Wednesday, as oil prices rebounded to their highest levels this week, ahead of a glut of macroeconomic data.
Dow Jones futures were down 125 points, or 0.2%, while the S&P 500 was flat and Nasdaq futures rose 0.1%.
Yesterday, the Dow added 229 points or 0.5% to close at 51,308; while the S&P and Nasdaq were essentially flat, edging up 10 to 7,610, and 7 points to 27,094, respectively.
Energy markets remained in focus. WTI crude climbed 2.3% to $95.91 a barrel, its highest level since 22 May, extending a rally driven by concerns over disruption to Middle East energy supplies.
Oil prices were driven higher after US forces carried out strikes against Iran, which retaliated against Kuwait and Bahrain, and this morning rejected Washington's claims that the attacks were in "self-defence" and were in fact a violation of the ceasefire.
In the world of diplomacy, regional sources said "the final text from Iran is still under discussion in Tehran and no response has been sent yet", while in the US Marco Rubio said that a deal "could happen today, it could happen tomorrow, it could happen next week”.
Overnight, President Trump pushed back against reports that negotiations had stalled, insisting that discussions "have been going on continuously, including four days ago, three days ago, two days ago, one day ago, and today.
"Where they lead, one never knows, but as I told Iran, ‘It’s time, one way or another, for you to make a deal. You’ve been doing this for 47 years, and it cannot be allowed to go on any longer!'"
Investors are also digesting a more cautious outlook from the OECD, which cut its global growth forecast for 2026 to 2.8% from 3.4% last year.
The organisation warned that a prolonged closure of the Strait of Hormuz could have severe consequences for the world economy, with global growth slowing to 2.1% this year and 1.8% in 2027.
Kathleen Brooks, research director at XTB, said there were "clear signs that the energy price spike is becoming embedded in the global economy", with business surveys indicating higher energy costs are feeding through into manufacturing prices.
Investors will have a busy slate of US economic data to sift through, with the ADP private payrolls report expected to show 122,000 jobs were added in May, while the services PMI data is forecast to ease slightly.
Later in the session, traders will scrutinise weekly oil inventory data and comments from Federal Reserve officials Michael Barr, Austan Goolsbee and Lorie Logan for clues on the outlook for interest rates.
In company news, there was an update from SpaceX overnight, with reports that the company is looking to price 555.6 million shares at a price of $135, eschewing the normal practice of offering a price range.
This means the IPO would raise a staggering $75 billion and value the rockets and satellites group at roughly $1.75 trillion.
Earlier, shares in Palo Alto Networks rose 10% in after-hours trading after the cybersecurity company reported strong results and hiked guidance, but the shares are down 3.5% in pre-market trading.