Morning Wrap: ASX 200 to fall, S&P 500 and Nasdaq at record highs as Dell soars 32% as AI revenues surge

In a nutshell:

• S&P 500, Dow and Nasdaq all closed at fresh all-time highs

• US-Iran traded messages over the weekend, seeking changes to the draft arrangement that would extend the ceasefire and open the Strait

• Oil extended its decline, down 11.8% for the week and 17.1% for the month

• Dell jumped about 33% on record revenue and surging AI server demand, powering the AI trade and lifting the broader tech complex

Let's dive in.

• Major US benchmarks finished higher and near best levels, with the S&P 500, Dow and Nasdaq all closing at fresh all-time highs

• Breadth was modestly negative, Tech and Financials were the only sectors to finish the session higher

• Brent slightly lower and down 9.5% for the week

• Blowout Dell (+32.7%) results further underpinned the insatiable AI demand narrative, though retail results disappointed, with names like Gap (-15.4%) and Costco (-3.9%) down on mixed results

• Walmart (-2.6%) was the Dow's biggest laggard, with consumer and healthcare names lagging the tech-led tape

• US weekly recap: S&P 500 (+1.43%), Dow (+0.90%), Nasdaq (+2.39%) and Russell 2000 (+1.75%)

• US 10-year yield eased to 4.43%, the lowest in three weeks as reports of a tentative US-Iran deal cooled inflation and rate worries

• VIX eased to ~15, near multi-week lows, as fading Middle East tension and the AI-led rally kept equity volatility subdued into month-end

• Wall Street bulls see more room to run on AI capex tailwinds (FT)

• AI bubble talks heat up with SOX on pace for best quarter ever (BBG)

• Unrealised losses for US private credit lenders deepen to 2.35% of NAV, worst since 2022 (RT)

• Cost of protecting against selloff lowest since early 2025, demand for bullish calls remains elevated across chip stocks (BBG)

• Samsung and SK Hynix rallies trigger forced selling as funds hit single-stock ownership limits (BBG)

• Hedge funds bearish on US natural gas for first time on 2024 amid plentiful domestic supplies, likely reduced export needs (BBG)

• US and Iran traded messages over the weekend, seeking changes to a draft agreement that would extend the ceasefire and open the Strait, semi-official Tasnim news agency notes both the US and Iran may reject the changes and the deal could collapse (BBG)

• Trump posted on Truth Social Friday that he would soon make a final determination on the Iran deal, insisting the Strait of Hormuz reopen immediately with no tolls for unrestricted two-way shipping (YF)

• Iran's new Persian Gulf Strait Authority vowed to keep operating without interruption after being added to the US Treasury sanctions list (CNN)

• Anthropic raises $65bn in Series H funding, surpassing OpenAI to become most valuable private AI startup (FT)

• Apollo and Blackstone look to bring additional investors to $36bn debt financing deal with Anthropic (BBG)

• Dell Q1 FY27 revenue up 88% year-on-year to $43.8bn, ~24% ahead of ests, with non-GAAP EPS of $4.86 vs. $2.94 ests, a roughly 65% beat (CNBC)

• Dell raised its full-year AI server revenue target to $60bn from $50bn after booking $24.4bn in AI orders and recognising $16.1bn of AI server revenue in the quarter (CNBC)

• Salesforce shares rallied 8.5% as a Q1 FY27 earnings beat and raised guidance, alongside an accelerated buyback and dividend, fuelled software-sector strength (TK)

• SpaceX lowers valuation target to at least $1.8tn, down from previously reported +$2tn (BBG)

• Costco's sales increase as value offerings attract inflation-weary consumers, including those at fuel pumps (BBG)

• Markets pared rate-hike bets after the tentative US-Iran deal report, pricing roughly a 37% chance of a December hike and no cut this year

• Minneapolis Fed's Kashkari believes it's premature to decide on hiking interest rates, says should keep options open (BBG)

• ECB's Panetta supports an interest-rate hike but advises against signaling further tightening measures (BBG)

• RBNZ policymakers prepare market for rate hikes, don't rule out aggressive action (BBG)

• China's manufacturing PMI came in at 50.0 for May, down 0.3 points from April, with the output sub-index at 51.2 but new orders slipping to 49.9, signalling softer demand (XIN) 

• Inflation in France and Spain accelerates to fastest level since 2024, raising ECB interest rate concerns (BBG)

• France's GDPunexpectedly contracted by 0.1% in early 2026 (BBG)

• Taiwan raises its growth forecast to 9.64% due to increased AI-related tech demand (BBG)

• US savings rate falls to lowest level since 2022 as affordability challenges mount (CNBC)

• BHP Port Hedland electrical workers threaten strike action by end of June (RT)

• Cettire to launch flagship store on TMall Global (CTT)

• Hub24 hit by a string of new conditions by APRA over concerns that it poorly managed conflicts of interest and lack of due diligence (AFR)

• Pro Medicus signs 5-year, $28m contract renewal with Allegheny Health Network (PME)

• Web Travel Group MD John Guscic offloads 2.7m shares, owns ~550k shares after the transaction (WEB)

• Collins Foods downgraded to Equal-weight from Overweight; target cut to $9.30 from $11.20 (Morgan Stanley)

• Sims upgraded to Equal-weight from Underweight; target up to $24 from $15.50 (Morgan Stanley)

• Telix initiated Overweight with $23.60 target (JPMorgan)

• Virgin initiated Outperform with $3.50 target (RBC)

Stocks trading ex-dividend: 

• Mon 1 Jun: L1 Long Short Fund (LSF) – $0.037

• Tue 2 Jun: None

• Wed 3 Jun: None

• Thu 4 Jun: None

Other ASX corporate actions today:       

• Dividends paid: FleetPartners Group (FPR)

• Earnings: None

• IPOs: None

• AGMs: None

Economic calendar (AEST):

• 11:00 am: Australia TD-MI Inflation Gauge

• 11:30 am: ANZ-Indeed Job Ads

• 11:45 am: China Manufacturing PMI

• 12:00 am: US ISM Manufacturing PMI