Dow Futures rise, driven by impressive results from key companies. The artificial intelligence chip giant reports yet another quarter of unprecedented revenue and profit, primarily driven by a surge in demand catalysed by the onset of the AI agents era. Files for what could be the largest initial public offering ever, while OpenAI is reportedly preparing for its own substantial flotation. Meanwhile, optimism persists regarding the potential for a peace agreement between the U.S. and Iran in the near future.

Dow futures edged higher on Thursday, erasing modest earlier losses, as investors analysed yet another batch of impressive returns from Nvidia and monitored developments in the Iran war. By 04:16, the index had risen by 98 points, or 0.2%, the other index was up by 15 points, or 0.2%, and a third index had jumped by 54 points, or 0.2%. The primary indices on Wall Street experienced an uptick on Wednesday, recovering from a three-day decline, influenced in part by optimism surrounding a potential resolution to the protracted conflict between the U.S. and Iran that has persisted for over two months. Oil prices experienced a decline, contributing to a moderation in the recent increase of U.S. Treasury yields and alleviating some of the pressure on equities. Minutes from the Federal Reserve’s April meeting were also released. Strategists at BCA Research noted that although the document contained language suggesting a bias toward future interest rate easing, it indicated that a majority of participants believe “some policy firming would likely become appropriate if inflation were to continue to run persistently above 2%. Analysts observed that the market narrative was transitioning from concerns regarding price increases and interest rates to a renewed focus on the trajectory of the AI boom. Chip stocks experienced a rally in anticipation of Nvidia’s results, which were released after the close of U.S. markets.

Those earnings illustrated a company capitalising on the prevailing optimism surrounding AI. April quarter sales at the company, a key indicator of the AI boom’s health, surged by 85% year-over-year to $81.6 billion, exceeding analysts’ forecasts. Net income reached $58.3 billion, more than threefold the amount from the prior year and significantly exceeding Wall Street expectations. CEO Jensen Huang emphasised the “era of agentic AI,” noting that the shift towards models capable of autonomously executing tasks for users has contributed to a “parabolic” increase in demand. In a recent note, analysts at Wedbush characterised Nvidia as a dominant player in the chip industry, likening it to a landlord, while stating that “everybody else [is] paying rent as more sovereigns and enterprises wait in queue for [its] chips. Shares of Nvidia exhibited a subdued performance in premarket trading, with analysts noting that the company’s outlook excluded sales in China and was only marginally above estimates. Given the elevated projections Nvidia consistently encounters, even results that exceed expectations may still fall short of market optimism, analysts have indicated.

While Nvidia’s stock price did not immediately surge, Elon Musk’s rocket company SpaceX was attracting attention as it filed for what could be the largest initial public offering ever. SpaceX is targeting to secure $80 billion or more from its flotation, a figure that would significantly surpass the existing record for the largest IPO, held by oil giant Saudi Aramco in 2019. Musk also stands to profit greatly, with the transaction set to make the tech tycoon the world’s first trillionaire in control of an 85% voting stake in the business. The filing provided insights into the extensive operations and financial standing of the firm. In addition to its capabilities in launching astronauts and satellites into space, SpaceX has developed a robust satellite internet division. The first generated $4.1 billion in revenue last year, yet it has continued to operate at a loss, whereas the other produced $11.4 billion in revenue. Total expenditures stood at $20.7 billion, primarily driven by outlays from xAI, Musk’s AI startup, which has been investing substantial sums in the construction of data centers. SpaceX and xAI merged in February, with analysts forecasting a potential collaboration between SpaceX and Musk’s electric carmaker Tesla in the upcoming year.

Elsewhere, OpenAI, currently embroiled in a lengthy legal dispute with Musk, is reportedly aiming for an initial public offering as soon as September. Sources reported that the plan remains fluid and may still undergo changes. Tipped to be another mega-deal, the Chat-GPT maker has reportedly been collaborating with bankers at firms including Goldman Sachs and Morgan Stanley to prepare for an IPO filing in the imminent days or weeks. A significant obstacle to the transaction was overcome earlier this week, as OpenAI triumphed in the legal battle against Musk. However, Musk has pledged to contest the verdict.

Beyond Nvidia, there was a prevailing sense of optimism regarding a potential agreement to resolve the protracted conflict between the U.S. and Iran, which has persisted for over two months. President Donald Trump indicated that the U.S. is in the “final stages” of a potential draft peace agreement, while also cautioning about the possibility of renewed hostilities, stating that “we’re going to do some things that are a little bit nasty” if a deal fails to materialise. Iran has indicated that it is currently assessing Washington’s latest stance regarding the resolution of the conflict. Investors are keenly seeking any signs that negotiations may lead to the reopening of the Strait of Hormuz, a crucial maritime route located off Iran’s southern coast, which has effectively been shut to tanker traffic since the onset of the conflict in late February. Shipping data in media reports earlier this week indicated that certain vessels have successfully navigated the conduit in recent days. Brent crude futures, the global oil benchmark, were last observed trading lower at $105.82 a barrel, following a decline from approximately $110 a barrel in response to Trump’s remarks. Brent remains significantly elevated compared to pre-war levels, which hovered around $70 per barrel.