U.S. stocks opened modestly lower on Monday evening, Beijing time. Geopolitical tensions took center stage at the start of a crucial week, driven by stalled Iran negotiations and escalating tensions in the Strait of Hormuz, which pushed oil prices higher. In corporate news, OpenAI revised its strategic cooperation agreement, removing Microsoft's exclusive status as its sole cloud provider.
The Dow Jones Industrial Average fell 92.10 points, or 0.19%, to 49,138.61. The Nasdaq Composite dropped 50.13 points, or 0.20%, to 24,786.47, while the S&P 500 declined 11.53 points, or 0.16%, to 7,153.55.
Geopolitical developments remained a key focus for markets. Over the weekend, U.S. President Trump canceled plans to send a special envoy and Jared Kushner to Pakistan for talks on an Iran ceasefire, suggesting negotiations could instead be conducted by phone. He stated on social media, "Too much time is wasted on travel, too much work!"
An Iranian foreign ministry spokesperson said there were currently no plans for a U.S.-Iran meeting.
Tensions near the Strait of Hormuz escalated further after Iran's Revolutionary Guard boarded two container ships near the vital waterway. As a result, West Texas Intermediate crude futures rose 1% to above $95 per barrel, while Brent crude futures also gained about 1%, surpassing $106 per barrel.
However, reports indicated that Iran had presented a new proposal to the U.S. regarding reopening the Strait of Hormuz and ending the conflict, while also recommending a delay in nuclear talks. Analysts suggested that although this represents a minor negative factor, the overall conflict remains on a de-escalation path.
On the corporate front, five of the so-called "Magnificent Seven" U.S. stocks are scheduled to report earnings in the final week of April.
OpenAI and Microsoft announced a revision to their strategic cooperation agreement on Monday, ending Microsoft's exclusivity as OpenAI's sole cloud services provider.
Specifically, the strategic partnership between OpenAI and Microsoft has undergone significant adjustments. Under the revised terms, OpenAI will gain substantial autonomy to freely choose any cloud provider—including Amazon AWS and Google Cloud—to host its core services and enterprise customer workloads.
The key change removes Microsoft's exclusive position as OpenAI's sole computing resource provider. The adjustments cover three main areas:
In terms of deployment flexibility, OpenAI can now secure independent computing resources and utilize other cloud providers to support its operations. Its non-API enterprise products can also be developed and deployed in multi-cloud environments.
Regarding intellectual property, Microsoft's rights to OpenAI's models and products have been extended until 2032 as part of the continued partnership.
On financial and exclusivity terms, revenue-sharing payments from OpenAI to Microsoft will be subject to an overall cap, though these payments will continue until 2030 and are not contingent on OpenAI's progress in artificial general intelligence.
Microsoft retains exclusive hosting rights for "stateless APIs," ensuring that core traffic from enterprises accessing OpenAI models via APIs continues to run on Azure.
Market attention is also turning to the Federal Reserve's policy decision on Wednesday, which may mark Chairman Powell's final meeting. The Justice Department's decision on Friday to drop its criminal investigation into Powell led a senator to lift a hold on the nomination of a successor.
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