May 4th Market Overview

Happy Monday

Ceasefire is off….Iran hit the UAE this morning, the Navy sank six Iranian boats in the Strait, and oil pushed higher.

The Dow took the heat but I'm actually watching bonds today. The 30-year Treasury crossed 5 for the first time since last summer, mortgage rates climbed right behind it, and that tells me the market is starting to believe oil-driven inflation is sticky, not temporary.

Let’s dig in...

Today's Big Picture

Iran Breaks The Ceasefire

The UAE intercepted Iranian missiles and drones, the first real attack since April's truce. The US Navy sank six small Iranian boats in the Strait of Hormuz. Shipowners are publicly refusing to move cargo without a guaranteed ceasefire. The strait stays closed and oil stays elevated.

Amazon Goes After FedEx And UPS

Amazon $AMZN opened its supply chain network to outside businesses. P&G, 3M, Lands' End, and American Eagle are already shipping through it. FedEx and UPS posted their worst day in over a year. This breaks the multi-year thesis for the entire freight complex.

The 30-Year Crosses 5

The 30-year Treasury yield broke 5 for the first time since last summer. Mortgage rates followed to a one-month high. The bond market is pricing oil-driven inflation as something that sticks, not something that passes. This matters more than today's equity move.

Market Overview

Index Performance

Stock Spotlight

eBay $EBAY ( ▲ 4.71% )  
closed near 109 after GameStop offered 125 per share in cash and stock. GameStop has 9 billion in cash against a 56 billion deal, leaving a financing gap they have not explained. CEO Ryan Cohen dodged funding questions on CNBC today. The market is pricing low odds of this closing.

Norwegian Cruise Line $NCLH ( ▼ 8.56% )  
cut full-year guidance as consumers rethink European travel. Higher fuel and weaker demand are hitting at the same time. The rest of the cruise group sold off with it.

Coinbase $COIN ( ▲ 6.66% )  
rallied after Congress reached a compromise on the CLARITY Act. The bill allows activity-based rewards but blocks interest on passive stablecoin deposits. Institutional crypto allocators waiting for regulatory clarity just lost their reason to stay sidelined.

Big Name Updates

Tyson Foods $TSN ( ▲ 6.71% )  
beat earnings and raised full-year guidance. CEO Donnie King credited a new chicken breed that grows faster on less feed. He expects margins to keep improving as the new genetics roll through.

Advanced Micro Devices $AMD ( ▼ 4.68% )  
fell after HSBC downgraded on tight 2026 wafer capacity. Tomorrow's print is a referendum on the entire AI hardware trade.

Palantir $PLTR ( ▲ 1.36% )  
reports after the bell tonight. Government revenue is priced in. The commercial number is the one I'm watching.

Walt Disney $DIS ( ▼ 1.72% )  
reports Wednesday morning. Josh D'Amaro's first earnings call as CEO. The street cares less about headline numbers and more about how he turns Disney+ into something bigger than streaming.

Other Notable Company News

Circle $CRCL ( ▲ 20.03% )  
closed higher on the CLARITY Act compromise.

American Express Global Business Travel $GBTG ( ▲ 57.34% )  
agreed to go private with Long Lake Management in a 6.3 billion deal.

Spirit Airlines $SAVEQ ( ▲ 0.43% )  
is canceling booked flights after Washington rejected its 500 million bailout request.

Anthropic (preIPO) 
announced a joint venture with Goldman Sachs, Blackstone, Apollo, and Sequoia to deploy Claude inside mid-sized companies. OpenAI raised over 4 billion for a similar deal with TPG and Brookfield. The enterprise AI deployment race just got real.

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Sector Watch

Bond Market

The 30-year Treasury yield crossed 5 today for the first time since last summer. Two-year and 10-year yields also climbed as Brent pushed above 114 and the inflation conversation returned.

• Mortgage rates hit their highest level in over a month.

• Tomorrow brings ISM Services and JOLTS job openings.

Policy Watch

Fed

NY Fed President John Williams said rates are well positioned despite growing inflation risks. He flagged supply-chain disruptions echoing 2021, but the labor market is weaker now, so companies can't pass higher costs through to consumers.

• Inflation expected to stay around 3 this year, a full point above the Fed's goal

• Last week's rate hold passed 8 to 4, the most dissents in nearly 34 years

• Powell will stay on as a Fed governor after his chair term ends May 15

Trade

Trump threatened to raise EU auto tariffs to 25 from 15. The EU was supposed to drop tariffs on US industrial goods in exchange for the lower auto rate last September, but that legislation is still stuck in Brussels.

• BMW, Mercedes, and Porsche all sold off

• Continental was the worst performer on the Stoxx 600

• The European Commission is keeping its options open

International

Project Freedom started today. US military assets will "guide" commercial ships through the Strait of Hormuz but stop short of warship escorts.

• The Navy sank six small Iranian boats interfering with commercial shipping

• Iran hit UAE's Fujairah oil port and an ADNOC oil carrier

• Trump warned Iran would be "blown off the face of the earth" if US ships are targeted

• Shipowners are still refusing to move cargo without a ceasefire guarantee

What to Watch

10 AI Stocks to Lead the Next Decade

MarketBeat did an excellent job on this AI infrastructure leaders report

AMD Earnings (Tuesday After The Bell)

The HSBC downgrade today raised the bar going in. The 2026 wafer capacity commentary is what matters, not headline EPS. This print resets expectations for Super Micro and Arm later this week.

Disney Earnings (Wednesday Morning)

Josh D'Amaro's first earnings call as CEO. Investors want clarity on his vision for the company, not the quarter.

Friday Jobs Report

April nonfarm payrolls Friday at 8:30 AM ET. With Williams flagging mixed labor signals, this can move the front end of the curve hard either way.

Yen Intervention Round Two

Tokyo likely spent 35 billion last week defending the yen, possibly by selling US Treasuries to fund it. If they go again this week, that is another hand pushing US yields higher.

Thanks for reading - you are now the more informed 🙂

- John

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