- Markets reset after relief rally
- Oil steadies, deal still uncertain
- SpaceX rally gathers momentum
- Salesforce buys into AI-first future
Matt Britzman, senior equity analyst, Hargreaves Lansdown:
“Global stock markets look set for a more settled session today, with futures pointing to a return to something closer to normal after yesterday’s relief rally. The FTSE 100 had a mixed day, held back by its heavy weighting toward energy as oil prices fell sharply and dragged on the likes of Shell and BP. Across the pond, Wall Street was in a much brighter mood, with new highs for some indices as investors cheered the combination of lower oil prices, less pressure on inflation and a reduced risk of further rate hikes following President Trump’s US-Iran deal. Tech was the clear winner, as growth stocks benefited from a backdrop that suddenly looks a little less hostile, though the rally’s durability still depends on the deal holding together.
Oil prices have steadied in the low $80s, but the market is not treating the reported US-Iran deal as done and dusted just yet. The proposed agreement could reopen the Strait of Hormuz, a vital route for around a fifth of global oil flows, and President Trump has said oil should begin moving freely again once the deal takes effect. But with the details still unpublished and the formal signing not expected until Friday, investors are understandably a little cautious.
Positive developments in the Middle East and a broader risk-on mood could hardly have landed at a better time for SpaceX, with the shares now almost 50% above the IPO price. The opening stretch was always likely to be volatile, and for now, that volatility has worked in investors’ favour, though it may still take a month or two for the technical moving parts around the listing to settle and for the market to show what it is really willing to pay for the business. Recent AI compute rental deals with Anthropic and Alphabet added a meaningful catalyst in the run-up to IPO day, helping prove out a near-term revenue source that doesn’t rely solely on new technologies. But there’s still a long way to go before the really big addressable markets in space get unlocked. The next markers are second-quarter results and, arguably more important for the long-term story, the next Starship launch – both of which could be in the next couple of months.
AI is clearly disruptive for parts of the software industry, including some of the biggest names on the planet, but size and scale bring options. Salesforce’s agreement to buy Fin, the AI customer service platform formerly known as Intercom, for around $3.6bn is a good example of how large software groups can try to buy their way into the AI-first world rather than build everything from scratch. Fin adds proven customer service agent technology to Salesforce’s Agentforce platform, and we think this kind of dealmaking could become a much bigger theme as incumbents look to defend their turf.”
