MARKET WRAPS
STOCKS: Stocks tumbled, and the Nasdaq composite lost more than 4% of its value, after a stronger-than-anticipated survey of the jobs market increased the likelihood of a Federal Reserve rate hike.
TREASURYS: Treasury yields surged in anticipation of a rate hike.
FOREX: The U.S. dollar rose sharply as futures markets priced in a 2026 Fed rate boost.
COMMODITIES: Oil futures fell as traders looked past clashes between Israel and Hezbollah and wagered on a U.S.-Iran peace deal.
HEADLINES
May Jobs Growth Puts U.S. on a Strong Hiring Streak
The U.S. labor market has climbed out of a rut.
The country added more jobs than expected in May, posting strong payroll gains for the third month in a row. Despite uncertainties around the Iran war, inflation, trade and artificial intelligence, the report suggests the U.S. labor market is steadily recovering from its weak patch last fall and winter.
Google to Pay SpaceX Nearly $1 Billion a Month in Cloud-Computing Deal
Google has agreed to rent data-center capacity from SpaceX, expanding the rocket company's artificial-intelligence business ahead of its initial public offering.
Google will pay SpaceX $920 million a month from October 2026 to June 2029 in a deal that includes the computing capacity of at least 110,000 Nvidia chips, according to a SpaceX securities filing on Friday.
The deal will ramp up over summer, and Google has the right to cancel the agreement in October if SpaceX doesn't provide the promised chips, SpaceX said. Either party can cancel the agreement starting next year with 90 days notice.
Morgan Stanley Sees SpaceX's Revenue Reaching $3.4 Trillion in 2040
To support the $1.77 trillion valuation Elon Musk's SpaceX is targeting in its initial public offering, bankers are telling investors to look to the future.
SpaceX's revenue could reach $3.4 trillion in 2040, according to a Morgan Stanley analysis shared with top investors Thursday, according to people familiar with the matter.
Morgan Stanley told investors the rocket maker's adjusted earnings before interest, taxes, depreciation and amortization in 2040 could top $2.7 trillion, the people said.
Paramount Skydance to Launch Videogame Studio
Paramount Skydance is launching a videogame studio and appointing the executive overseeing the company's integration planning with Warner Bros. Discovery to run it.
The new Paramount Games Studio will be helmed by Tony Driscoll as president. Driscoll, who serves as head of corporate strategy and development, will also continue leading the process of integrating Warner Bros. into Paramount, the company said Friday.
The studio will roll together Skydance's existing gaming outfits, Skydance Interactive and Skydance New Media.
U.S. Officials Discuss Taking Financial Stakes in AI Industry
WASHINGTON-Senior U.S. officials have discussed having the federal government take stakes in major artificial-intelligence companies, according to people familiar with the matter, after OpenAI Chief Executive Sam Altman pitched the idea to the administration last year.
Such a move would allow the government to share in the potential economic upside of the fast-evolving technology, give the AI companies a stamp of approval from those in charge of regulating their models and potentially temper rising anxiety about the economic fallout of the AI revolution as several AI companies prepare to go public. But any potential partnerships could also expose the U.S. government to possible volatility of the AI market.
Some AI executives have warned that their powerful new tools could upend how people live and work and ultimately transform the labor market. Silicon Valley has floated a variety of proposals for how society could adapt to the new economic realities of the AI era, including the creation of shared income for the masses to the creation of a sovereign-wealth fund.
Apple's Plan for AI Dominance Rests on Fixing Its Much-Maligned Chatbot
Siri is one of the dumbest chatbots on the market. Apple hopes a reboot can power its AI comeback.
When Apple stages its annual developer conference next week, the big reveal is expected to be a modern version of Siri that will look more like ChatGPT. Gone will be the old version, which has been so limited for so long that many people, if they ever use it, do so only for basic functions like setting timers.
The new Siri, built atop Google's Gemini technology, is expected to offer a more modern search experience, remembering users' prior queries and accessing data from their devices for personalized responses. A new stand-alone Siri app with a paid tier, similar to competing artificial-intelligence apps, is also expected.
Quantinuum Stock Falls After Uninspiring Quantum IPO Debut. What Went Wrong?
Quantinuum stock popped in its trading debut, opening 13% above its initial public offering price in what seemed to be a major win for the quantum computing industry. That momentum is quickly fading, with the shares set to fall Friday after a flat first day.
Shares opened at $68 on Thursday before easing to $60.38, ending the session with a gain of just 0.6%. Regardless, the stock outperformed other notable names in the sector: IonQ closed down 3.8% while D-Wave Quantum and Rigetti Computing added 0.3% each.
But Quantinuum fell into the red on Friday as it slid nearly 9% to $55.02, firmly below its offer price. Peer stocks were faring even worse, with IonQ., D-Wave, and Rigetti each down more than 11% as the broader market slid.
Stahl, Whitaker, Wertheim Say They Will Stay at '60 Minutes'
The three remaining "60 Minutes" correspondents-Lesley Stahl, Bill Whitaker and Jon Wertheim-said Friday they will remain with the CBS News show.
In an internal memo reviewed by The Wall Street Journal, the trio said their decision to remain with the iconic newsmagazine should not be seen as an endorsement of recent firings of on-air and managerial talent but rather as a signal of their desire to make sure the show doesn't die.
"We have been grieving because this whole mess has wounded and damaged the broadcast. We want to stay and fight, try to repair and preserve our reputation," they wrote.
TALKING POINT Small Stocks Are Trouncing Market Giants-and That's Not a Good Sign
While market watchers obsess about the dominance of a handful of gigantic stocks, smaller companies are the real winners this year.
The scale of outperformance is chunky. The Russell Microcap index of market tiddlers is up 21%, the Russell 2000 small-capitalization index a bit less, and the S&P 500 only slightly over half as much. Go to the very largest, and the Russell Top 50 index of super-megacap stocks is up only 6%, with the Magnificent Seven stocks up even less.
How it happened is a tale of speculation, the oil panic and the rotating winners from artificial intelligence, with a walk-on part for the weird way indexes work.
Investors should be paying attention, both to understand why smaller stocks did so well, and why it might not last.
Speculation is most obvious in the tiniest companies. Penny stocks, usually defined as those that trade for less than $5 a share, are often opaque and get zero attention from Wall Street analysts. When they go up this quickly, it's often more about a frenzy among investors than underlying economic fundamentals.
Since March 30, penny stocks have risen 28% on average, well above the 22% of non-penny stocks in the Microcap index-and beat the Mag 7 of Amazon, Alphabet, Apple, Meta, Microsoft, Nvidia and Tesla. Unlike the Mag 7, the tiniest companies were slightly up in the first quarter, too.
--James Mackintosh
Expected Major Events for Monday
04:30/JPN: May Corporate Insolvencies
05:00/JPN: May Economy Watchers Survey
06:00/GER: Apr Manufacturing orders
06:00/GER: Apr Manufacturing turnover
14:00/US: May Employment Trends Index
14:00/US: 1Q Quarterly Financial Report - Industry
14:00/US: 1Q Quarterly Financial Report - Retail Trade
23:01/UK: May BRC-KPMG Retail Sales Monitor
23:50/JPN: May Money Stock, Broadly-defined Liquidity
All times in GMT. Powered by Onclusive and Dow Jones.
Expected Earnings for Monday
Aberdeen International Inc (AAB.T,AABVF) is expected to report for 1Q.
AstroNova Inc (ALOT) is expected to report for 1Q.
Campbell's Co $(CPB)$ is expected to report $0.48 for 3Q.
Comtech Telecommunications Corp $(CMTL)$ is expected to report $-0.54 for 3Q.
Duluth Holdings Inc (DLTH) is expected to report $-0.45 for 1Q.
FuelCell Energy Inc $(FCEL)$ is expected to report for 2Q.
Graham Corp (GHM) is expected to report $0.29 for 4Q.
Lyra Therapeutics Inc $(LYRA)$ is expected to report for 1Q.
Mama's Creations Inc $(MAMA)$ is expected to report $0.03 for 1Q.
Mission Produce Inc (AVO) is expected to report $0.02 for 2Q.
Motorcar Parts of America Inc (MPAA) is expected to report $0.16 for 4Q.
Oil-Dri Corp of America $(ODC)$ is expected to report for 3Q.
Optical Cable Corp $(OCC)$ is expected to report for 2Q.
Vail Resorts Inc (MTN) is expected to report $8.96 for 3Q.
Powered by Onclusive and Dow Jones.
We offer an enhanced version of this briefing that is optimized for viewing on mobile devices and sent directly to your email inbox. If you would like to sign up, please go to https://newsplus.wsj.com/subscriptions.
This article is a text version of a Wall Street Journal newsletter published earlier today.
(END) Dow Jones Newswires
June 05, 2026 16:37 ET (20:37 GMT)
Copyright (c) 2026 Dow Jones & Company, Inc.
Comments