Good Afternoon. A two-day record run on the S&P 500 and Nasdaq looked tired by lunch in New York. The Dow gave back its early move above 50,000, energy lagged again as oil dropped a second straight day, and the AI mega-caps caught a breather even after Tokyo's Nikkei jumped 5.6% to a record 62,834 on its first session back from Golden Week. Weekly jobless claims came in at 189,000, well below the 205,000 consensus, keeping the labor backdrop firm before tomorrow's nonfarm payrolls.

—Rosie, Wyatt, Evan & Conor

🔥 What’s Hot: 🔥

🥶 What’s Not: 🥶

1. Stocks Fade Near Records as Trump Threatens Iran Strikes

The News: The S&P 500 and Nasdaq Composite paused near record highs Thursday after President Trump told reporters in the Oval Office it is "too soon" for direct talks with Iran and warned that "the bombing will be far worse than ever before" if Tehran does not sign the one-page memorandum of understanding under review. The Dow briefly cleared 50,000 for the first time before fading, with index-tracking SPY off 0.2%, QQQ near flat and DIA down 0.5% by midday. Energy was the worst-performing S&P sector again as WTI crude declined to roughly $91 a barrel, while a senior Iranian official told CBS News Tehran is "carefully reviewing" the proposal and noted the deadline mentioned by Washington is "an internal U.S. timeline."

Why It Matters: For investors, the move is a textbook consolidation — the S&P 500 advanced more than 2.5% over Tuesday and Wednesday, and giving back a fraction of that on a fresh tariff-and-bombing-threat headline is healthy positioning rather than a top. The fact that gold held firm and Treasuries flattened says traders are still pricing the diplomatic path as the base case. For consumers, the renewed bombing language is the reason gas-station prices have not yet adjusted lower — refiners are waiting to see whether the framework actually gets signed before passing through the crude move.

What to Watch: Whether Iran's foreign ministry names Abbas Araghchi or someone else as the Round 2 lead, and whether the one-page MOU language leaks before the weekend.

Source: Investopedia and CBS News

2. Initial Jobless Claims Drop to 189,000 — Below Every Major Forecast

The News: Weekly initial unemployment claims fell to 189,000 for the week ended May 2, the Labor Department said Thursday, well below the 205,000 consensus and down from 205,000 the prior week. Continuing claims came in at roughly 1.86 million. The four-week moving average dropped to 200,750. The reading is the lowest weekly initial-claims figure since November 2025 and lands one day before tomorrow's BLS nonfarm payrolls release.

Why It Matters: For investors, a sub-190,000 claims read essentially rules out a "labor cliff" surprise on Friday — when claims dropped this fast historically, NFP has come in at the high end of the consensus range. Combined with Wednesday's ADP showing 109,000 private adds, the broader picture is that hiring has slowed but layoffs have not picked up, which is the soft-landing scenario rate cuts are priced against. For consumers, low claims plus 4.4% wage growth means real income is still positive, even if hiring momentum has cooled.

What to Watch: Friday's NFP at 8:30 a.m. ET (consensus 175,000), the unemployment rate (4.2% expected), and average hourly earnings.

Source: Investopedia

3. Arm Holdings Posts Q4 Beat, Stock Up 14% as AI Royalty Story Builds

The News: Arm Holdings reported fiscal Q4 2026 revenue of $1.49 billion, up 20% year over year and ahead of the $1.47 billion consensus, with adjusted EPS of $0.60 versus the $0.58 estimate. Royalty revenue grew on continued AI accelerator and smartphone strength, and the company's commentary on data center custom-silicon design wins was the bullish framing the call needed. Shares advanced 13.6% in after-hours trading Wednesday and added another roughly 6% intraday Thursday after a brief volatility spell on chip-supply commentary, settling near $237 — within striking distance of an all-time high.

Why It Matters: For investors, Arm's royalty model is the cleanest "tax on the AI buildout" — every Nvidia Grace, AMD MI450 and custom hyperscaler chip ships with Arm IP, and the royalty rate is rising as licensees move to the v9 architecture. The 20% revenue growth at this scale, with operating leverage still expanding, is among the most attractive setups in semis. For consumers, Arm's commentary on smartphone royalty pricing is the early read on whether AI-PC and AI-phone cycles materialize at higher unit ASPs.

What to Watch: Whether Arm's first internally designed chip (the rumored data center accelerator) gets a formal launch later this quarter, and the royalty-rate cadence on v9.

Source: MarketBeat and Yahoo Finance

4. DoorDash Beats Q1 EPS, Strong Q2 Guide Drives Shares Up 12%

The News: DoorDash reported Q1 2026 revenue of $4.04 billion, up 33% year over year (21% excluding the Deliveroo acquisition), missing the $4.15 billion consensus by about $115 million, but adjusted EPS came in at $0.42 versus the $0.36 estimate. Marketplace gross order volume climbed 37% to $31.6 billion (24% ex-Deliveroo), and total orders rose 27% to 933 million. Adjusted EBITDA grew 28% to $754 million. The company guided Q2 GOV to a range of $32.4 billion to $33.4 billion (above the $32.43 billion consensus midpoint) and adjusted EBITDA of $770 million to $870 million. Shares advanced about 12% intraday.

Why It Matters: For investors, the Deliveroo deal is doing exactly what management said it would — adding consolidated international growth without diluting U.S. economics. The Q2 GOV guide implies third-party logistics is taking share from grocery and convenience competitors. For consumers, DoorDash's commentary that consumer cohorts continue to spend at higher frequencies even with sticky food-inflation is the practical signal — delivery has crossed from luxury to staple in the household budget.

What to Watch: International margin trajectory, the gas-rewards program extension decision, and whether the company starts disclosing AI-driven order acceleration metrics.

Source: Business Wire and CNBC

5. Snap Falls 12% on Soft Q2 Guide and Cancelled Perplexity Deal

The News: Snap shares declined approximately 12% Thursday morning after the company reported Q1 2026 revenue of $1.53 billion, up 12% year over year, with global daily active users of 483 million and a net loss narrowed to $89 million. Adjusted EBITDA more than doubled to $233 million. But Snap guided Q2 revenue to $1.52 billion to $1.55 billion — a midpoint roughly in line with the $1.54 billion consensus — and explicitly noted the guide includes no contribution from the previously announced $400 million Perplexity advertising partnership, which was "amicably concluded" in Q1. Snap also flagged $20–25 million in Q1 ad-revenue headwinds tied to the Iran conflict, and disclosed that North America DAUs declined sequentially by 2 million.

Why It Matters: For investors, the Perplexity cancellation is the bigger story than the Q2 guide — that deal would have been the first AI-search-platform-on-Snap revenue line, and its loss removes a 2H catalyst. The North America DAU drop is the deeper concern: the 7% year-over-year decline suggests structural rather than cyclical pressure, even as monetization improves. For consumers, the commentary that engagement among Snap+ subscribers continues to grow is the silver lining.

What to Watch: Whether Q3 ad-revenue trend stabilizes North America DAUs, and whether Snap announces a replacement AI-search partnership in coming weeks.

Source: CNBC

6. Japan's Nikkei Soars 5.6% to Record 62,834

The News: Japan's Nikkei 225 advanced 5.6% Thursday to a record close of 62,833.84, the first close above 62,000 in the index's history, as Tokyo's first session back from Golden Week caught up to the global AI-driven rally. The broader Topix climbed 3% to 3,840.49, just below its own record high. SoftBank Group surged 18.4% — its largest single-session move since 2020 — boosted by its stakes in Arm and OpenAI. Advantest gained 7%, Tokyo Electron 9% and Renesas Electronics 13%. The yen held near 152 per dollar and 10-year JGBs steadied with policy easing expected to remain on hold.

Why It Matters: For investors, the Nikkei's 5.6% one-day gain is one of the largest single-session advances in three decades, but the framing matters — Global X strategist Billy Leung noted Japan was "essentially accounting for three sessions in one" after global risk assets rallied while Tokyo was closed. SoftBank as a listed AI proxy is now arguably the best non-U.S. expression of the OpenAI/Arm capex thesis. For consumers, the wealth-effect trickle from a record Nikkei is non-trivial — Japanese household equity exposure has been climbing since the NISA reform.

What to Watch: Whether the BoJ's June meeting language softens on the back of the equity-driven wealth effect, and whether SoftBank's Arm stake gets monetized further.

Source: CNBC and The Japan Times

7. EU Fails to Finalize U.S. Trade Deal as 25% Auto Tariff Looms

The News: The European Union failed to finalize a long-delayed U.S. trade deal during overnight talks Wednesday, despite warnings from President Trump that fresh tariffs are imminent. EU negotiators from the European Parliament and member states discussed amendments to the transatlantic deal originally struck at Trump's Turnberry resort in July 2025, but did not reach conclusive decisions, according to Cyprus, which holds the EU's rotating presidency. Talks are expected to continue. The Cypriot Energy Minister said officials are "committed to moving swiftly," and EU trade chief Maros Sefcovic met with U.S. Trade Representative Jamieson Greer in Paris ahead of a G7 trade ministers meeting Wednesday.

Why It Matters: For investors, the Stoxx 600 traded flat after Wednesday's 2.1% advance — Europe is now stuck between Trump's threat to escalate the auto tariff to 25% effective immediately and Brussels's slow ratification cycle. The German auto names that gained on yesterday's peace-trade enthusiasm are the most exposed if the tariff path goes from "threat" to "law" before the weekend. For consumers, prolonged uncertainty on the U.S.-EU 15% baseline means imported European goods continue to face the higher rate while talks drag on.

What to Watch: Whether Brussels approves the deal before its July one-year anniversary deadline, the next round of U.S.-EU staff talks, and any unilateral European Commission tariff response.

Source: Bloomberg

8. Oil Steadies After 8% Plunge

The News: Crude oil steadied Thursday after Wednesday's collapse, with WTI declining a further 1-2% to roughly $91 a barrel and Brent slipping under $100 to about $99.50 in midday New York trading. The two-day move has now taken WTI down roughly 13% on the week and Brent off about 12%. The U.S. dollar index advanced 0.3% to 98.04 against major peers as the Iran-deal premium continued to bleed out of risk currencies. Trump's "very serious bombing" comments did not move oil materially higher, with traders continuing to price the diplomatic path as the base case. The EIA inventory report showed a 1.3-million-barrel commercial crude build for the week, slightly below the 1.5-million-barrel consensus.

Why It Matters: For investors, the resilience of the oil decline despite Trump's escalation language is the cleanest signal yet that energy traders trust the framework. With WTI off 13% on the week, Q2 energy earnings are at risk, but downstream refiners and airlines are now the cleanest "lower oil" trade. For consumers, U.S. retail gasoline should reset 25-35 cents per gallon lower over the next 10-14 days if WTI holds below $93.

What to Watch: OPEC+'s response at the next joint ministerial monitoring committee meeting and whether the SPR begins large refill purchases at sub-$95 WTI.

Source: TechStock

Q: Why did the golfer bring two pairs of pants?

A: In case he got a hole in one.

The economic value embedded in having the right, but not the obligation, to take a future action — a strategic option that becomes more valuable as uncertainty rises. In corporate finance, optionality includes the ability to expand, abandon, defer, or switch a project, and is often valued using real-options analysis rather than DCF.

Usage: "SoftBank's 18% surge today is largely a re-rating of the optionality embedded in its Arm and OpenAI stakes — call options on the AI capex cycle that compound regardless of which model wins."

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