The market is stabilizing, taking a modest step back from yesterday’s rally. The first recovery attempt failed after reports from an Iranian leader saying near-weapon-grade uranium should not be sent abroad. This created doubts about the progress of the peace talks between the US and Iran and sent oil prices climbing back over $107.

Russell 2000 is retaking its 20-day moving average and is the only index in the green.

Defensive sectors are higher with Utilities (XLU) and Health Care (XLV) leading. Consumer Staples is sharply lower due to results from Walmart (WMT), which were somewhat disappointing with EPS coming in just in-line while issuing guidance for Q2 below analysts’ expectations. Deere (DE) is weighing down the industrial sector despite reporting Q2 beat.

AI Update

Anthropic is in talks to rent Azure servers powered by MSFT’s Maia AI chips. This would deepen its existing relationship that is already moving fast. Anthropic already uses Amazon (AMZN), Google (GOOG/L) and Nvidia (NVDA) chips.

Economic Data

The Q2 GDP from Atlanta Fed is up to 4.26%, the highest since it initiated tracking in April 30^th.

April Housing starts declined 2.8% MoM, beating consensus of -5.3% but lower than +12% seen in March. This was driven by a drastic decline in single-family construction.