Less than a day after declaring peace talks with Iran were "very boring, " President Donald Trump has seemingly switched focus to something he never seems to tire of -- and it's likely to test one of the longest market rallies in nearly three decades.
The Trump administration unveiled plans to revive its dormant tariff strategy -- the bulk of which was struck down by the Supreme Court earlier this year -- with proposed levies on a host of major trading partners.
A separate raft of duties, tied to section 301 tariff rules that give the government tremendous leeway, are expected over the coming weeks.
Stocks aren't reacting to the new round of duties as yet, but new developments in the U.S. war with Iran -- which included attacks on key targets in the Islamic republic and a wave of attempted drone strikes from Tehran -- are keeping markets in check.
Global oil prices have been marching higher, taking Brent crude close to the $96 a barrel mark, while Treasury bond yields renewed their selloff with 30-year paper back to within a whisker of the 5% mark.
Stocks, meanwhile, look set to test their nine-day rally, the longest in a year, which has generated five consecutive record highs for the S&P 500 and put the benchmark on pace for its best run of gains since 1995.
Tariffs aren't likely to be the straw that broke this record run's back, but they do suggest a shifting focus for a president who has grown weary of the stalemate in the Gulf region and is perhaps looking for a way to bolster support for his Republican colleagues as midterm elections loom. And the tech-led rally, which has lifted the Nasdaq more than 30% since its late March lows, is starting to feel vulnerable.
-- Martin Baccardax
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FOMO Is Fueling the AI Stock Trading Frenzy
AI investors have a bad case of FOMO. Marvell Technology's 32% stock rally Tuesday is the latest sign the "fear of missing out" on artificial intelligence influences a lot of investors' decisions these days. But when market speculation overtakes the actual fundamentals, the risks of a sharp reversal increase.
-- Marvell and other tech hardware stocks are rising on relentless demand
for the hardware needed to build AI data centers. But Steve Sosnick,
chief strategist at Interactive Brokers, says sharp uptrends or parabolic
moves are a sign of speculation, or chasing momentum, and less about
serious analysis.
-- HPE's large rally followed strong earnings, but it's been a good year for
the stock already. The risk is that eventually, hyperscalers and other
big tech hardware spenders will pull back their investments. Any
indication of that could lead to a selloff for shares of those benefiting
from AI spending.
-- Other stocks are jumping from speculative trading as AI excitement
spreads. Fluence Energy soared 44% on Monday after the advanced battery
energy storage company joined a deal to work with Nvidia on developing
data centers. AI chip maker Cerebras Systems jumped 68% on its IPO day
last month.
-- Sosnick compared the behavior to a popular NYC harbor cruise. "When you
go by the Statue of Liberty, everybody rushes to one side of the boat,
and then the boat turns around, everybody rushes to the other side,"
Sosnick said. "Nobody wants to be left behind on a big move."
What's Next: Broadcom stock closed at a record on Tuesday, pushing its market value above $2 trillion. The stock has rallied for the past four trading sessions, gaining 14%, a hot streak can be attributed to general excitement ahead of Broadcom's earnings report today.
-- Angela Palumbo, George Glover, and Mackenzie Tatananni
Prediction Markets Crushed Sportsbooks. Are Exchanges Next?
Sportsbooks like DraftKings have been under pressure over the past year by prediction markets, which offer futures contracts that closely resemble sports bets. Now prediction markets are expanding beyond those contracts, putting a new industry under pressure: financial exchanges.
-- Kalshi, one prediction market platform, offers trading in perpetual
futures linked to Bitcoin, something the CFTC just approved. Unlike a
typical event contract on a prediction market, perpetuals don't have an
expiration date, and traders can apply leverage to their positions. They
aren't offered on traditional exchanges like the CME.
-- Perpetuals have been available overseas but are a new product in the U.S.
Kalshi co-founder Luana Lopes Lara said in a recent podcast interview
that their goal is to become a general purpose exchange and the world's
largest derivative exchange. Traders can apply leverage to their
positions in perpetuals.
-- TD Cowen analysts say the CFTC's decision to approve them for Kalshi
creates more competition in the retail market and could weigh on
multiples for exchange stocks. CME's stock is down roughly 11% since last
Friday's approval, and Cboe Global Markets is down 20%.
-- CFTC Chair Mike Selig wrote last week that the commodity markets
regulator is working on a framework for true crypto asset perpetual
contracts. Kalshi has already filed with the CFTC to certify perpetual
futures tied to cryptocurrencies beyond Bitcoin.
What's Next: Benjamin Schiffrin, director of securities policy for Better Markets, a consumer-focused advocacy group, cautioned that there are risks for investors. "Perpetual futures facilitate continuous speculation and potentially overtrading, rapid losses and financial harm."
-- Nick Devor and Janet H. Cho
Six Companies Lined Up to IPO Ahead of SpaceX's Listing
There are a half dozen initial public offerings this week where the companies are seeking valuations of $1 billion or more, getting out of the gate before next week's giant SpaceX offering, which could detail its pricing today, according to The Wall Street Journal, which reported the SpaceX valuation could reach $1.75 trillion.
-- The biggest debut of this week is Innio, a maker of gas engines that
sells equipment to AI data centers. It is looking to sell 75 million
shares at up to $27 a share. At the midpoint, Innio would raise $1.9
billion and be valued at a little more than $19 billion.
-- Quantum computer company Quantinuum, majority-owned by aerospace leader
Honeywell, aims to go public at a more than $10 billion valuation, and is
hoping to cash in on the current bull market for all things quantum.
Quantinuum will sell 26.5 million shares at $53 to $55.
-- The four other IPOs lined up this week are less buzzy, but they all
combine as an important test. IPO activity has slowed so far this year,
with the number of new stocks tumbling 22% from this time a year ago,
according to Renaissance Capital.
-- But Renaissance says this year's crop of debuts has raised $28.8 billion,
up 144% from last year's levels. Once SpaceX comes out -- which is
expected sometime next week -- the AI developer Anthropic may not be far
behind. It confidentially filed its paperwork already.
What's Next: Elon Musk's commercial space company may sell under 5% of its shares, the Journal reported, which is smaller than a typical IPO. The numbers, including a targeted share price, are expected to be filed later today, the report said.
-- Paul R. La Monica and Janet H. Cho
SpaceX Halo Outshines Virgin Galactic's Reality
Space stocks have been in hot demand ahead of that massive SpaceX debut, but for the space company founded by Elon Musk's billionaire rival Richard Branson, not so much. Virgin Galactic had its worst trading day ever on Tuesday after it announced a stock sale to pay down debt.
-- Redeeming the roughly $10 million in first-lien notes due in 2027 at
current stock prices means issuing some two million shares, or about 2%
of total shares outstanding. That represents significant dilution for
shareholders.
-- Virgin Galactic still has about $20 million in notes outstanding, paying
annual interest of 9.8%. Completing repayment of the 2027 notes means no
further principal payments will be required until March 2028.
-- The company ended the first quarter with about $250 million in cash,
restricted cash, and marketable securities on its balance sheet. Wall
Street sees the company using about $220 million in cash in the second,
third, and fourth quarters combined.
-- Virgin Galactic is acting opportunistically. Coming into Tuesday trading,
shares were on a seven-day winning streak, sending them up 204%. Even
with Tuesday's drop, shares have still risen about 50% year to date. It
did a 1-for-20 reverse stock split in 2024.
What's Next: Space tourism just hasn't developed as quickly as Virgin Galactic or its early investors had expected. The company still expects to start commercial space tourism operations in the fourth quarter of 2026.
-- Al Root
Dear Quentin,
I'm 55, married and actively evaluating long-term-care $(LTC)$ insurance. Before this turns into a broader debate: I'm not looking for your opinion on whether I should buy it or suggestions to self-fund -- I've already made that decision for planning reasons.
What I'm specifically looking for: the type of policy (traditional LTC vs. hybrid life plus LTC), key features (inflation rider, elimination period etc.) and, most importantly, what experience your readers have had with underwriting or other surprises.
I'm not looking for a "don't do it" opinion or pushing "self-funding" discussions. Nor do I seek generic recommendations. I'm trying to get real-world experiences. I would also consider this an exercise in sticking to the question asked.
Pricing depends on age, health, inflation riders, benefit period, elimination period and whether it's traditional or hybrid. There is no "one-size-fits-all" quote. Planning for both spouses materially changes the funding need.
To make self-funding work for my goals, I would need to set aside enough money today to cover about 5 years of care at roughly $150,000 per year. As this is for both my wife and me, I would need to self-fund with $1.5 million right now for long-term care.
In theory, investment growth could help offset inflation in care costs, but those gains would also be taxed over time when I withdraw the money. After looking at the numbers, including taxes and inflation assumptions, I don't think this approach works for me.
-- Looking for Answers
Read the Moneyist's response here.
-- Quentin Fottrell
-- Newsletter edited by Liz Moyer, Patrick O'Donnell, Rupert Steiner
This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.
(END) Dow Jones Newswires
June 03, 2026 06:15 ET (10:15 GMT)
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