On Thursday, May 7, U.S. stock index futures for the three major averages were all trading higher pre-market. Dow Jones Industrial Average futures rose 0.20%, S&P 500 futures gained 0.12%, and Nasdaq 100 futures edged up 0.05%.
At the time of writing, Germany's DAX index was down 0.33%, the UK's FTSE 100 index fell 0.62%, France's CAC 40 index declined 0.06%, and the Euro Stoxx 50 index dipped 0.07%.
WTI crude oil dropped 4.34% to $90.95 per barrel, while Brent crude fell 3.99% to $97.23 per barrel. The decline followed market news that Iran has designated two shipping lanes in the Strait of Hormuz, causing oil prices to drop sharply. Iran's Islamic Revolutionary Guard Corps Navy announced the establishment of two designated passage routes. Concurrently, Middle Eastern media, citing sources, reported that the U.S. and Iran have reached a consensus on easing the maritime blockade and gradually reopening the strait. This news prompted a rapid decline in international oil prices.
According to Iranian media reports on the 7th, the IRGC Navy has specified two routes for vessel transit, while vessels still require Iranian permission to cross the Strait of Hormuz. Previously, reports cited by Middle Eastern media indicated an agreement between Iran and the U.S. involving an easing of the U.S. maritime blockade in exchange for a phased reopening of the strait. This report has not yet been confirmed by either the U.S. or Iran. Following the announcement, international oil prices continued to fall, with Brent crude's intraday loss reaching 3.0% to $97.98 per barrel. U.S. crude oil fell sharply, approaching the $90 mark.
Japan's government has reportedly intervened in the currency market again. Analysis of the latest Bank of Japan accounts by Wall Street analysts suggests that Japanese fiscal authorities may have intervened with approximately $30 billion in the foreign exchange market, just days after a previous intervention of about $25 billion in late April. This is seen as the latest sign of the Ministry of Finance's firm commitment to supporting the yen. A comparison of BOJ accounts and money broker forecasts released Thursday indicated the scale of intervention may have been around 4.68 trillion yen. Thursday was the first working day after Japan's Golden Week holiday ended on Wednesday. The Japanese government appears to be escalating its "yen defense" from a one-off market intervention to a continuous, selective, and coherent management of the exchange rate defense line.
The White House's Digital Asset Advisor has stated an aim to finalize the "Digital Asset Market Clarity Act" by July 4. Patrick Witt, Executive Director of the White House Advisory Committee on Digital Assets, revealed at the CoinDesk's Consensus conference in Miami on Wednesday that the White House is pushing for Congress to pass the CLARITY Act before Independence Day. Witt stated, "We are targeting July 4. I think this would be a great birthday present for America's 250th anniversary." He further detailed the planned path: draft review by the Senate Banking Committee this month, a full Senate vote utilizing the four working weeks in June, and allowing sufficient time for a House vote before the July 4 deadline.
**Individual Stock News** **McDonald's (MCD.US)** reported mixed Q1 results, with revenue and profit exceeding expectations, but U.S. same-store sales growth falling short. The company's Q1 performance showed a trend of "strong profits but slightly weak growth." Despite surpassing expectations for both revenue and profit in a challenging consumer environment, its same-store sales growth in the crucial U.S. market missed Wall Street forecasts. Adjusted earnings per share for Q1 were $2.83, beating the expected $2.74. Revenue rose 9% year-over-year to $6.52 billion, also exceeding the expected $6.47 billion. Net profit increased to $1.98 billion from $1.87 billion a year earlier. However, in the key U.S. market, same-store sales grew only 3.9%, below the analyst consensus of 4.2%. This slight gap reflects increased consumer caution regarding spending, pressured by rising fuel and grocery costs, despite the company's push for value meals and limited-time offers.
**Shell (SHEL.US)** reported Q1 profit that exceeded expectations, fueled by a surge in oil and gas prices that heated up its trading business. Boosted by higher oil and gas prices and increased market volatility linked to the Iran conflict, Shell's trading division performed strongly. Adjusted net profit for Q1 2026 was $6.92 billion, significantly higher than the $5.58 billion reported a year ago and surpassing the analyst consensus expectation of $6.36 billion. Adjusted EBITDA rose to $17.7 billion from $15.3 billion in the prior-year period. The stock was down 1.95% in after-hours trading at the time of writing. The company attributed the significant profit growth primarily to stronger contributions from trading and optimization in the Downstream and Renewables segments, higher realized oil and gas prices, improved refining margins, and lower operating costs. Since the outbreak of the Iran conflict in late February, Brent crude prices have surged over 50%, with increased market volatility providing a significant tailwind for European energy giants with large trading platforms.
**Albemarle (ALB.US)** followed the surge in lithium prices, reporting Q1 profit that crushed expectations. The world's largest lithium producer announced Q1 2026 results that far exceeded market forecasts, signaling a formal recovery for the lithium industry. The chemical giant reported Q1 net income of $319.1 million, or $2.34 per share, compared to just $49.3 million, or break-even per share, a year ago. Excluding one-time items, adjusted EPS was $2.95, far exceeding the analyst average expectation of $1.09. Revenue performance was also strong. Q1 net sales increased 33% year-over-year to $1.43 billion, slightly above the average analyst forecast. Adjusted EBITDA jumped to $663.8 million, not only surpassing the expected $468.2 million but also more than doubling compared to the previous year, representing a year-on-year increase of approximately 148%.
**Applovin (APP.US)** reported a 109% year-over-year surge in Q1 net profit, with Q2 guidance exceeding expectations. The mobile software company's Q1 2026 results showed revenue grew 59% to $1.842 billion, better than the average analyst expectation of $1.78 billion. Adjusted EBITDA was $1.557 billion, a 66% increase. Net income was $1.206 billion, up 109%. Earnings per share were $3.56, beating the average analyst estimate of $3.46. For Q2, AppLovin expects revenue between $1.915 billion and $1.945 billion, above the average analyst expectation of $1.89 billion. It expects an adjusted EBITDA margin between 84% and 85%.
**DoorDash (DASH.US)** reported record Q1 membership sign-ups, with Q2 guidance exceeding expectations, indicating sustained strong demand. The U.S. food delivery platform's Q1 results showed revenue grew 33% to $4.04 billion, missing the average analyst expectation of $4.15 billion, which analysts attributed to lower platform take rates. Earnings per share were $0.42, better than the average expectation of $0.36. DoorDash achieved a record number of membership sign-ups in the quarter. The company stated that DashPass membership in the U.S. accelerated, driven by new sign-ups and lower churn. Internationally, membership for DashPass, Wolt+, and Deliveroo Plus also grew. DoorDash expects Q2 Marketplace Gross Order Value to be between $32.4 billion and $33.4 billion, above the average analyst expectation of $32.3 billion, signaling continued strong consumer demand for its services in the U.S. and internationally.
**Sony (SONY.US)** is planning a nearly $4 billion acquisition of music copyrights, including works by Justin Bieber and Neil Young. Sony Music is finalizing a deal with Blackstone to acquire a music catalog that includes works by artists such as Justin Bieber and Neil Young. If completed, the transaction would be one of the largest music rights acquisitions in history. Sources indicated Sony has entered exclusive negotiations to acquire Blackstone's Recognition Music Group, which owns or manages the rights to over 45,000 songs. Sony will form a joint venture with Singapore's sovereign wealth fund GIC to complete the acquisition, with the deal value estimated between $3.5 billion and $4 billion.
**Key Economic Data and Events Preview** * 20:30 Beijing Time: U.S. Initial Jobless Claims
**Earnings Preview** * Friday Pre-Market: Microchip Technology (MCHP.US), CoreWeave (CRWV.US), Applied Optoelectronics (AAOI.US)
