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Wall Street stocks were mixed on Tuesday on a record-setting rally as hopes faded for a swift return of Strait of Hormuz oil flows and focus turned to the Federal Reserve’s policy meeting.
The Dow Jones Industrial Average (^DJI) nudged up 0.4% after soaring to an all-time closing high on Monday as markets celebrated a US-Iran peace deal. The S&P 500 (^GSPC) and the tech-heavy Nasdaq Composite (^IXIC), meanwhile, hovered near the flat line.
Markets are digesting warnings that Friday’s reopening of the Strait of Hormuz promised by the US-Iran agreement isn’t likely to be easy, and it could take months for oil shipments to ramp up. Uncertainty over the deal’s details, which have yet to be released, is also cooling optimism. However, US officials have said commercial traffic will be allowed to use the waterway without tolls.
That provides a complicated backdrop to the Fed meeting, with recent inflation reports running hotter than expected amid the war in Iran, which has pushed energy prices higher. Its counterpart, the Bank of Japan, on Tuesday raised its benchmark interest rate to a 31-year high to counter those price pressures.
Officials begin their June meeting on Tuesday, ahead of Wednesday’s closely watched rate decision — the first under President Trump-backed Chair Kevin Warsh. While the Fed is overwhelmingly expected to hold rates steady this time, many on Wall Street expect a shift toward hikes this year in the “dot plot” of policymakers’ expectations.
Meanwhile, SpaceX (SPCX) shares jumped further, pointing to a third day of post-IPO gains. The Elon Musk-led company opened higher and is close to overtaking Amazon (AMZN) in market value, which would make it the world’s fifth-largest company.
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SpaceX surpasses Amazon in market value, becomes 5th largest company in the world
SpaceX (SPCX) just surpassed Amazon (AMZN) in market value, becoming the world’s fifth-largest company just days after hitting the public markets.
Shares of the rocket and satellite company jumped 10%, giving SpaceX a market capitalization of $2.72 trillion, compared with Amazon’s $2.65 trillion, according to a Yahoo Finance comparison.
The stock is up 60% from its IPO price of $135 per share. It surged on Tuesday following SpaceX’s acquisition of the AI tool Cursor and the start of options trading on the stock.
A comparison of the market caps of SpaceX, Amazon, and Microsoft. SpaceX’s value is also encroaching on Microsoft’s valuation of $2.92 trillion, which, if reached, would make it the fourth-biggest company.
The gap is a bit wider to reach the top three largest companies — Nvidia (NVDA), Alphabet (GOOG, GOOGL), and Apple (AAPL) — as those Big Tech giants have market caps above $4 trillion.
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Stocks mixed at the open, with all eyes on SpaceX, the Fed, and Hormuz
The rally in US stocks took a breather on Tuesday as investors looked ahead to the Fed meeting and weighed US-Iran deal uncertainty.
The S&P 500 (^GSPC) and the tech-heavy Nasdaq Composite (^IXIC) traded roughly flat at the open. The Dow Jones Industrial Average (^DJI) added 0.4%.
Meanwhile, oil moved below $80 per barrel as markets began pricing in the Strait of Hormuz reopening, despite some lingering doubts. Futures on Brent crude oil (BZ=F) fell more than 3% to $80 per barrel, while West Texas Intermediate futures (CL=F) also dropped 3% to $76 per barrel.
In individual stocks, SpaceX (SPCX) is the one to watch. Shares of Elon Musk’s rocket company popped another 4% on Tuesday morning, rising for the third day in a row since the company went public.
SpaceX stock is currently trading at $200 per share, putting its market cap at $2.62 trillion. That’s just shy of the market value of Amazon (AMZN), which has a market value of $2.65 trillion, and not far off from Microsoft’s (MSFT) market value of $2.92 trillion.
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Brent crude prices fall below $80 per barrel for first time since March 3
Futures on Brent crude oil (BZ=F), the international benchmark, briefly dipped below $80 per barrel on Tuesday — as low as $79.96 — for the first time since March 3, which was only days after the start of the Iran war.
In the wake of US and Israeli strikes on Iran beginning Feb. 28, crude oil prices on both Brent and the US benchmark, WTI crude (CL=F), skyrocketed, climbing up to nearly $120 per barrel. US WTI crude crossed and held below $78 per barrel on Tuesday.
Prices have fallen precipitously since the opening of futures trading for the week on Sunday evening after President Trump announced Washington and Tehran had agreed to the terms of a memorandum of understanding to end the war that has roiled the global energy market.
President Trump and the Iranian parliamentary speaker are reported to have signed the deal electronically on Monday, with a formal signing ceremony scheduled for Friday in Switzerland.
While terms have not been made public, the deal is understood to require the full reopening of the Strait of Hormuz by both sides of the conflict, with a 60-day negotiation period to follow on issues such as Iran’s nuclear program and longer-term control of the strait.
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Yum! Brands to sell Pizza Hut for $2.7 billion
Yahoo Finance’s Brian Sozzi reports that Yum! Brands (YUM) just announced it has entered into a deal to sell Pizza Hut, which should make the restaurant company stronger. He writes:
Yum! Brands said on Tuesday morning that it has entered into definitive agreements to sell Pizza Hut for $2.7 billion, subject to certain purchase price adjustments. It’s a two-part transaction.
Pizza Hut will be sold to private equity firm LongRange Capital for $1.5 billion, and Pizza Hut China will be sold to Yum China for approximately $1.2 billion.
Yum! Brands’ stock rose less than 1% in premarket trading.
The total sale price is more than double the market cap of Papa John’s (PZZA), which has also been rumored to be shopping itself for a sale. But it’s light-years away from Domino’s Pizza’s (DPZ) $10.2 billion market cap.
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Robinhood stock rises on plans to lay off 10% of staff
Robinhood (HOOD) stock rose 1.6% in premarket trading on Tuesday after the company announced it plans to lay off 290 employees, or about 10% of its workforce.
Yahoo Finance’s David Hollerith reports:
The move is intended to “maintain a high performance culture, further accelerate product velocity, and remain lean and disciplined,” according to a regulatory filing signed by CFO Shiv Verma. Robinhood will incur $20 million in severance and restructuring charges, with $8 million in related share-based compensation payments.
In a memo posted on X, Robinhood CEO Vlad Tenev maintained that the financial and investing app has “never been stronger” and said that the goal of the reduction is “to maximize our talent density and ensure that our culture is defined by an absolute elite performance bar.”
“To achieve the massive scale of our mission, we cannot default to operating as a heavily-layered organization,” Tenev said. “We must be a lean, hyper-focused team where every single individual is empowered to make a massive impact,” he added
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SpaceX becomes retail’s biggest IPO trade
Yahoo Finance’s Jared Blikre writes in today’s Chart of the Day:
SpaceX’s (SPCX) market debut turned into a record retail buying event, with individual investors buying more of the stock on day one than they did in Coinbase (COIN), Uber (UBER), Arm (ARM), or Airbnb (ABNB), according to data from Vanda Research tracking major IPOs since 2018.
Vanda Research Retail investors bought a net $117.6 million of SpaceX on Friday, topping Coinbase’s $92 million in its April 2021 debut.
That confirmed what Vanda’s pre-IPO retail-flow data had already hinted: Retail traders were not just watching SpaceX. They were making room for it.
… “SpaceX has officially entered the big leagues for retail investors,” Vanda wrote.
The firm said that outside of Nvidia (NVDA), retail investors have rarely bought more than $100 million of any “Magnificent Seven” stock on a single day this year.
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Kevin Warsh’s Fed debut comes at a pivotal moment for global monetary policy
US investors will have all eyes focused on Wednesday’s Federal Reserve meeting — Kevin Warsh’s first as chair. But the Fed is only one move in a busy stretch that sees four of the world’s major central banks deliver policy decisions in less than three days.
Yahoo Finance’s Jake Conley writes:
The concentration of central bank decisions comes at a moment when policymakers around the world are confronting the classic question of an energy shock: Whether to address concerns over inflation or growth.
For much of the past several years before the war, central banks confronted a steady picture: Inflation was easing, economic growth remained resilient, and policymakers could focus on calibrating the pace of policy normalization. Yet 2025 and 2026 both brought major shocks.
… “The two global macro forces — the cyclical and energy shocks — may be countervailing on growth but they are amplifying on inflation,” JPMorgan strategist Alex Gallin wrote in a recent note. “This has prompted a sharp shift in policy discussion and, in some cases, in action.”
The result is a policy backdrop that looks increasingly uncomfortable for central bankers. While growth concerns might ordinarily argue for lower rates, renewed inflation pressures are making it difficult for policymakers to signal easier policy.
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SpaceX set to overtake Amazon in market cap as stock jumps another 10%
Shares of SpaceX (SPCX) rose more than 10% in premarket trading on Tuesday, extending their post-IPO rally.
The move sets Elon Musk’s company up to overtake Amazon (AMZN) in market value and to become the world’s fifth‑largest company, just days after the stock began trading on Friday.
Reuters reports:
The stock was last up 10.4% at $212.50, a jump of more than 57% above its $135 IPO price and giving the company a market capitalization of nearly $2.8 trillion if gains hold. Amazon’s valuation, meanwhile, stands at $2.66 trillion.
“We can say with certainty that this valuation makes absolutely no sense today. People are buying SpaceX in the expectation that others will buy too and push the price higher — that’s speculation,” said Ipek Ozkardeskaya, senior market analyst at Swissquote Bank.
The company reported sales of $18.67 billion last year and a net loss of $4.94 billion after merging with money-losing xAI — in contrast to many of Wall Street’s big technology companies that have posted bumper numbers.
SpaceX options activity is set to begin as soon as Tuesday, with early activity expected to be heavy, volatile and likely expensive.
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Bank of Japan raises interest rates to 31-year high
The Bank of Japan raised interest rates to a 31-year high on Tuesday, marking another landmark step in normalising monetary policy as it focused on taming price pressures from the energy shock caused by the Iran war.
Reuters reports:
In a widely expected move, the BOJ decided to raise its short-term policy rate to 1% from 0.75%, taking borrowing costs to levels unseen since 1995.In a statement announcing the decision, the BOJ said the risk of Japan’s economy deteriorating sharply from the Middle East conflict has diminished due to progress made in procuring alternative energy supplies.
The hike was the first since December and aligns the BOJ with other central banks shifting towards tighter policy to combat inflation, including the European Central Bank.
BOJ’s Shinichi Uchida at the press conference. REUTERS/Kim Kyung-Hoon · REUTERS / REUTERS Deputy Governor Shinichi Uchida acknowledged the recent U.S.-Iranian peace deal, which he described as a “welcome move”, but noted persistent inflationary risks.
“Compared with the previous meeting, the risk of a sharp deterioration in the economy has diminished. On the other hand, price rises are broadening and there is a risk underlying inflation may deviate from our target,” Uchida said in a news conference he held on behalf of Governor Kazuo Ueda, who missed the meeting for medical treatment.
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Asian shares rise across region as Hormuz opening ripples across global markets
Reuters reports:
Asian shares mostly gained and Japan’s benchmark Nikkei 225 briefly topped 70,000 for the first time Tuesday before trimming early gains after the Bank of Japan raised its key interest rate to 1%.
The quarter percentage point hike took the benchmark rate to its highest level in three decades.
By early afternoon, the Nikkei 225 (^N225) was up 0.6% at 69,713.05, while South Korea’s Kospi moved further into record territory, gaining 2.1% to 8,721.64.
The Shanghai Composite (000888.SS) gained less than 0.1% to 4,100.53.
Australia’s S&P/ASX 200 (^AXJO) lost 0.3% to 8,892.10 and Hong Kong’s Hang Seng (^HSI) slipped 1.3% to 24,533.35.
In Taiwan, the Taiex was up 0.6%, while India’s Sensex picked up 0.5%.
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Oil holds following largest drop in months with Hormuz opening on horizon
Bloomberg reports:
Oil steadied after the biggest drop in more than two weeks as traders, shippers and producers waited for details of a US-Iran deal that’s intended to pave the way for the full reopening of the Strait of Hormuz.
Brent (BZ=F) traded above $83 a barrel after sinking almost 5% on Monday, while West Texas Intermediate (CL=F) was near $81. The interim agreement is due to be signed by both sides in Switzerland on Friday, although Washington and Tehran have yet to release the text of the memorandum of understanding.”
The lack of detail has kept the market cautious. Persian Gulf energy officials said they had been inundated with inquiries from buyers about whether crude could once again move through the strait, while shipping executives and traders said they need more clarity before committing vessels to the route.
Oil’s drop to the lowest since early March has erased the bulk of the gains seen during the conflict, easing inflationary pressures just as policymakers at the Federal Reserve assess interest rates this week. Still, a reopening may not mean an immediate return to normal, with questions lingering over shipping safety, operating rules and whether the chokepoint — which carried about a fifth of oil supply before the war — will actually remain toll-free.
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SpaceX climbs over 40% in two days since IPO
Yahoo Finance’s Pras Subramanian reports:
SpaceX (SPCX) stock jumped over 19% on Monday in its first full trading day on Wall Street, giving the shares a two-day pop of 43% since the rocket company’s market debut.
SpaceX had offered 555.6 million shares to investors, raising a record $75 billion, but the company confirmed on Monday that it actually raised $85.7 billion after underwriters exercised their “green shoe” option to sell an additional 83,333,333 shares.
The appetite for SpaceX stocks seems unabated, with some commentators now likening it to a momentum stock, though one that could be volatile.
“SpaceX going public is an important watershed moment for the broader tech sector in our view as this AI Revolution and data takes this next step forward,” Wedbush analyst Dan Ives wrote on Monday, predicting it will lead to more capital deployed at the companies and boost upcoming IPOs for Anthropic (ANTH.PVT) and OpenAI (OPAI.PVT).
