US stocks opened with a small gain on Friday, supported by optimism about pending trading in SpaceX, which made history with the biggest-ever IPO, and the potential for an interim peace deal in the Iran conflict.
The S&P 500 Index advanced 0.1% at 9:36 a.m. in New York. The Nasdaq 100 Index slipped 0.1%. West Texas Intermediate crude oil fell around 3% to about $85 a barrel, as the US and Iran were said to be edging toward signing an agreement to reopen the Strait of Hormuz on the sidelines of the Group of Seven world leaders summit next week.
SpaceX’s IPO will be released for quotation at 9:50 a.m., and eligible for trading at 10 a.m., Nasdaq said. Pre-IPO trading in derivatives indicated a gain of anything between 30% and 50% as retail investors were flocking to the anticipated listing.
“Investors are evenly split as to whether the SpaceX IPO marks the peak of an incredible stock-market run or a paradigm-shifting change in how growth is valued in the markets,” said Craig Coben, a managing director at Seda Experts and former global head of equity capital markets at Bank of America Corp.
Earlier, S&P 500 futures climbed amid “a bit of a cocktail between oil weaker, SpaceX hype, and a market still built on strong earnings,” said Todd Sohn, chief ETF strategist of Strategas Securities. Regarding SpaceX, he said “demand is clearly through the roof.”
As hopes build toward a potential peace agreement, Iran’s state-run Islamic Republic News Agency, or IRNA, on Friday said the country wouldn’t restore the waterway’s pre-war status, and it’s seeking war-related compensation. Iran’s Fars news agency on Thursday said officials hadn’t yet approved the text of any agreement with the US.
“Caution is warranted” around the prospects for an accord, Karl Schamotta, Corpay’s chief market strategist, wrote in a note. However, “even a temporary reopening of the Strait of Hormuz could ease the inflation shock facing global central banks, allowing markets to price in more modest tightening trajectories.”
In single-stocks trading, Adobe Inc. shares tumbled 8.6%, after the software maker said its Chief Financial Officer Dan Durn would depart on June 15. Durn is headed to Marvell Technology Inc., which fell 2.7%. The news came after Adobe’s chief executive announced he would resign earlier this year. “You basically have an S&P 500 company operating without a CEO and CFO,” Jefferies trader Jeffrey Favuzza wrote in a note. “Can’t think of any other S&P 500 company where this has happened.”
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