Market Analysis

The major U.S. index futures are currently pointing to a slightly higher open on Thursday, with stocks likely to show a more modest moves to the upside after surging over the two previous sessions.

Optimism about a peaceful end to the conflict in the Middle East may generate continued buying interest, although traders may be reluctant to make more significant moves.

The surge over the past two days has lifted the Nasdaq and S&P 500 to new record highs and traders may want to see more tangible results from U.S.-Iran negotiations before making big bets.

President Donald Trump said Wednesday that the U.S. and Iran have had “good talks over the last 24 hours” and expressed confidence a deal could be reached in the coming days.

A report from Axios said U.S. officials expect Iran’s response to a one-page memorandum of understanding to end the war within the next 24-48 hours.

Noting some U.S. officials are skeptical a deal will come together, Axios said the White House wants a diplomatic breakthrough by the time Trump wraps his China trip next Friday and could resume military action if a deal is not in hand by then.

Stocks moved sharply higher early in the session on Wednesday and saw further upside as the day progressed. The major averages added to the gains posted during Tuesday's session, with the Nasdaq and S&P 500 reaching new record closing highs.

The major averages ended the day just off their highs of the session. The Nasdaq surged 512.82 points or 2 percent to 25,838.94, the S&P 500 shot up 105.90 points or 1.5 percent to 7,365.12 and the Dow jumped 612.34 points or 1.2 percent to 49,910.59.

The rally on Wall Street came amid optimism about an end to the conflict in the Middle East after a report from Axios said the White House believes it's getting close to an agreement with Iran on a one-page memorandum of understanding.

Citing two U.S. officials and two other sources briefed on the issue, Axios said the deal would include Iran committing to a moratorium on nuclear enrichment and both sides lifting restrictions around transit through the Strait of Hormuz.

While noting that nothing has been agreed yet, the sources told Axios this was the closest the parties had been to an agreement since the war began.

Adding to the optimism about a peace deal, President Donald Trump said the U.S. would pause its efforts to escort ships through the Strait of Hormuz to see whether or not the agreement can be finalized and signed.

The strength on Wall Street also came amid a sharp increase by shares of Advanced Micro Devices (AMD), with the chipmaker soaring by 18.6 percent.

AMD surged after reporting first quarter results that exceeded analyst estimates on both the top and bottom lines and providing upbeat second quarter guidance.

On the U.S. economic front, payroll processor ADP released a report showing private sector employment in the U.S. jumped by more than expected in the month of April.

ADP said private sector employment shot up by 109,000 jobs in April after climbing by a downwardly revised 61,000 jobs in March.

Economists had expected private sector employment to grow by 85,000 jobs compared to the addition of 62,000 jobs originally reported for the previous month.

Gold stocks skyrocketed amid a sharp increase by the price of the precious metal, with the NYSE Arca Gold Bugs Index soaring by 7.6 percent.

Substantial strength was also visible among computer hardware stocks, as reflected by the 7.2 percent spike by the NYSE Arca Computer Hardware Index.

Airline stocks also showed a significant move to the upside, driving the NYSE Arca Airline Index up by 6.9 percent.

Semiconductor, steel and biotechnology stocks also turned in strong performances on the day, while energy stocks moved sharply lower along with the price of crude oil.

Commodity, Currency Markets

Crude oil futures are plunging $4.45 to $90.63 a barrel after nosediving $7.19 to $95.08 a barrel on Wednesday. Meanwhile, after soaring $125.80 to $4,694.30 an ounce in the previous session, gold futures are jumping $52.70 to $4,747 an ounce.

On the currency front, the U.S. dollar is trading at 156.34 yen versus the 156.39 yen it fetched at the close of New York trading on Wednesday. Against the euro, the dollar is valued at $1.1770 compared to yesterday’s $1.1747.

Asia

Asian stocks advanced on Thursday as AMD's first quarter results topped estimates and investors expressed hopes for a peace deal between the United States and Iran.

The dollar index was subdued in Asian trading, helping gold prices jump more than 1 percent toward $4,750 an ounce.

Oil prices extended losses, with Brent crude futures falling nearly 2 percent toward $99 a barrel after tumbling almost 8 percent in the previous session.

China's Shanghai Composite Index rose 0.5 percent to 4,180.09 ahead of U.S. President Donald Trump's visit to Beijing next week.

Hong Kong's Hang Seng Index surged 1.6 percent to 26,626.28, led by heavyweight technology and financial names.

Japanese markets hit a fresh record high, with chip-related and other tech stocks rallying on optimism about global AI chip demand.

The Nikkei 225 Index soared 5.6 percent to 62,833.84, logging its largest single-day gain ever as traders returned from the Golden Week holiday. The broader Topix Index settled 3 percent higher at 3,840.49.

SoftBank Group spiked 18.4 percent as investors eyed Roze spinoff and its AI investments. Advantest, Tokyo Electron, Lasertec and Renesas Electronics surged 5-13 percent.

The yen was flat against the dollar after a top currency official signaled that the government is prepared to respond on all fronts to speculative moves in the foreign exchange market.

Earlier in the day, minutes from the Bank of Japan's March meeting showed that many board members saw the need to raise rates if the Iran war-driven energy shock is prolonged.

Seoul stocks hit a new peak as bond yields fell on hopes for a U.S.-Iran deal to end the Middle East conflict. The Kospi jumped 1.4 percent to 7,490.95, led by tech, auto and bank shares. Market bellwether Samsung Electronics climbed 2.1 percent and chip giant SK Hynix added 3.3 percent.

Australian markets rallied after reports suggested that the U.S. had presented Iran with a one-page framework that could lead to the gradual reopening of the Strait of Hormuz.

The benchmark S&P/ASX 200 Index advanced 1 percent to 8,878.10, while the broader All Ordinaries Index closed 1 percent higher at 9,107.

Gold stocks and miners topped the gainers list as energy stocks tracked oil prices lower. Investors shrugged off data that showed Australia logged an unexpected trade deficit in March.

Across the Tasman, New Zealand's benchmark S&P/NZX-50 Index ended up 1 percent at 13,270.61. Infratil shares jumped by over 4 percent after the company signed a major data center agreement.

Europe

European stocks are broadly lower on Thursday after posting strong gains in the previous session on AI-driven optimism and hopes for an end to the Middle East conflict. The downside was capped after data showed German factory orders grew at a faster pace in March.

Factory orders surged 5.0 percent in March compared to February's revised growth of 1.4 percent as manufacturers rushed to secure raw materials ahead of potential future price increases and supply shortages, Destatis reported.

The monthly increase significantly outpaced the 1.0 percent forecast and also marked the fastest growth in three months. Excluding large orders, new orders were 5.1 percent higher than in the previous month.

While the U.K.’s FTSE 100 Index is down by 0.6 percent, the German DAX Index is down by 0.1 percent and the French CAC 40 Index is just below the unchanged line.

Coca-Cola HBC shares tumbled 3.3 percent as the soft drink bottler reported first quarter organic revenue growth below forecasts.

Retailer JD Sports Fashion soared 5 percent as it reported full-year sales and profits roughly in line with expectations.

Shell shares declined 2 percent. The oil giant trimmed its quarterly share buyback from $3.5?billion to $3?billion.

InterContinental Hotels rallied 2.8 percent after reporting higher revenue in the first quarter.

Aerospace and defense group BAE Systems tumbled 3.4 percent despite affirming its sales and underlying EPS guidance for 2026.

German consumer goods and adhesives maker Henkel jumped 4.3 percent after reporting first-quarter sales growth above expectations.

Rheinmetall fell 2.8 percent. The defense group announced that it has submitted a non-binding offer to acquire German Naval Yards Kiel.

Medical technology company Siemens Healthineers slumped 4.7 percent after cutting its full-year outlook for revenue growth.

Global transport firm A.P. Møller - Mærsk fell 4.3 percent as first-quarter profit declined on the back of lower rates.

French utility Engie dropped 2.2 percent on reporting lower first-quarter earnings.

Conglomerate Bouygues lost 2 percent. The company announced that it doesn't plan to sell assets to fund its joint 20.35-billion-euro cash bid for rival operator SFR.

U.S. Economic News

A report released by the Labor Department on Thursday showed first-time claims for U.S. unemployment benefits rebounded by less than expected in the week ended May 2nd.

The Labor Department said initial jobless claims rose to 200,000, an increase of 10,000 from the previous week's revised level of 190,000.

Economists had expected jobless claims to climb to 205,000 from the 189,000 originally reported for the previous week.

Meanwhile, the report said the less volatile four-week moving average slipped to 203,250, a decrease of 4,500 from the previous week's revised average of 207,750.

Labor productivity in the U.S. increased by much less than expected in the first quarter of 2026, according to preliminary data released by the Labor Department on Thursday.

The report said labor productivity climbed by 0.8 percent in the first quarter after jumping by a downwardly revised 1.6 percent in the fourth quarter of 2025.

Economists had expected productivity to shoot up by 1.7 percent compared to the 1.8 percent leap that had been reported for the previous quarter.

Meanwhile, the Labor Department said unit labor costs surged by 2.3 percent in the first quarter after soaring by an upwardly revised 4.6 percent in the fourth quarter.

Unit labor costs were expected to jump by 2.0 percent compared to the 4.4 percent spike that had been reported for the previous quarter.

At 10 am ET, the Commerce Department is scheduled to release its report on construction spending in the month of March. Construction spending is expected to increase by 0.4 percent.

Minneapolis Federal Reserve President Neel Kashkari is slated to participate in a fireside chat before the 2026 InvestUP CEO Summit at 1 pm ET.

At 2:05 pm ET, Cleveland Federal Reserve President Beth Hammack is due to speak on “Fed 101 and policy” in a fireside chat before the 2026 Ohio CEO Summit.

The Federal Reserve is scheduled to release its report on consumer credit in the month of March at 3 pm ET. Consumer credit is expected to climb by $12.0 billion.

At 3:30 pm ET, New York Federal Reserve President John Williams is due to participate in a moderated discussion before event organized by the Hudson Valley Pattern for Progress.