Market to Give Back Gains After Iran Setback: 8 Key Items Shaping the Stock Market Monday

These are the early headlines and other items poised to influence the market at the start of the trading day. As we share this collection of market drivers, U.S. equity futures point to a lower market open later this morning.

1. The U.S.-Israeli war with Iran has already cost companies around the world at least $25 billion — and the bill is climbing, according to a Reuters analysis. A review of corporate statements since the start of the conflict by companies listed in the United States, Europe and Asia offers a sobering look at the fallout. Businesses are grappling with soaring energy prices, fractured supply ‌chains and trade routes severed by Iran’s chokehold on the Strait of Hormuz… As growth slows, pricing power will weaken and fixed costs will become harder to absorb, analysts say, threatening profit margins ⁠in the second quarter and beyond. Sustained price hikes are likely to fuel inflation, hurting already-fragile consumer confidence. (Reuters)

International Energy Agency Executive Director Fatih Birol warned that the tally of commercial oil inventories is shrinking at an accelerated pace… He also highlighted that the spike in fertilizer and diesel prices comes at the start of the travel and planting season. “This could have major implications for the food prices and together with the higher energy prices they might give a big push to inflation numbers,” (Bloomberg)

The U.S.-Iran war is now 80 days old, and the Strait of Hormuz remains largely closed with no obvious pathway to a deal, meaning higher oil prices should stick around for a while. Over the weekend, President Trump posted on Truth Social that the “clock is ticking” for Iran, hours after drones targeted a nuclear power plant in the United Arab Emirates. Trump continued, saying “Tehran, better get moving, FAST, or there won’t be anything left of them…”

Put all that together, and you can understand why U.S. equity futures point to the market giving back some of its recent gains when the stock market begins trading later on Monday. As we discussed in Friday’s Weekly Roundup, given the duration and follow-through of the war, it’s only a matter of time until investors question how realistic consensus EPS figures are for the S&P 500, ones that call for 23% growth compared to 2025.

2. Anthropic has agreed to brief from leading finance ministries and central banks on vulnerabilities in the global financial system’s cyber defences identified by the US technology company’s latest AI model… Many of its members are increasingly alarmed about the potential risks that Mythos and AI models developed by other US tech companies could pose to the global banking system by exposing weaknesses in lenders’ cyber defences. (FT)

We see that as confirming our view that AI can be used to both augment cybersecurity offerings as well as extend the scale and scope of cyberattacks. We continue to think cybersecurity should be a part of every investor’s investment strategy, and we prefer the exposure granted by the cybersecurity ETF, First Trust Nasdaq Cybercity ETF (CIBR), which we own in the Portfolio.

3. Elon Musk’s rocket and satellite maker SpaceX is aiming to list its shares as early as June 12 and has picked the Nasdaq as the ‌trading venue for its blockbuster market debut… (Reuters)

The rocket, satellite and artificial intelligence company is seeking to raise as much as $75 billion on a valuation of more than $2 trillion, Bloomberg previously reported. That would make it the largest IPO of all time. (Bloomberg)

This suggests one of, if not the biggest, IPO will be here before too long. Expectations are that SpaceX’s prospectus will become public as early as Wednesday, with IPO deal roadshow targeted to start on June 4. That implies a pricing around June 11 to 12 and suggests hefty investment banking fees will be booked in the current quarter. Pricing but also post IPO trading on the recent Cerebras Systems (CBRAS) and SpaceX offerings, as well as those in between, will determine the strength of the IPO market in 2H 2026. So far, that outlook is pretty bright, but we will want to monitor market conditions for any bumps along the way.

4. NextEra Energy, one of the largest power companies in the United States, is in advanced talks to acquire Dominion Energy, in a deal that could transform the power industry as it races to supply electricity needed to fuel the booming growth of artificial intelligence, two people familiar with the matter said Sunday. (NY Times)

Investors expected M&A activity to pick up this year, in part due to less stringent reviews and regulators’ willingness to approve business consolidations under President Trump. This is another confirmation point for that and brings another bullish slant for investment banking fees. We’ll want to see if this spurs consolidation activity in the electric utility space and what that may mean for electric utility capital spending plans.

5. Publicis Groupe has agreed to acquire LiveRamp for $2.2 billion all-cash deal, the French holding company said Sunday. Publicis is betting the acquisition will position it as a leader in agentic transformation—or the use of AI agents to automate and collaborate on corporate workflows… LiveRamp specializes in so-called “data collaboration,” which allows different companies to share and build new data sets and data models together. These can be used for many purposes, including powering agentic frameworks. (AdWeek)

A reminder about the growing importance of data and the access to it to not only better target consumers but also to train AI models. LiveRamp connects more than 25,000 publisher domains and over 500 technology and data partners across 14 markets.

6. Walmart, Target, and Home Depot all report this week. They might provide the best gauge of how consumers are feeling with the average price of gas sitting above $4.50 a gallon. Although tax refunds should mitigate some of the pain, shareholders will be watching to see whether executives signal they will pass on price increases to customers or seek to boost their market share by taking a hit to margins. (Barron’s)

While the largest company in the S&P 500 and the Nasdaq 100 (NDX), Nvidia (NVDA) will report after Wednesday’s market close, results from retailers and consumer-facing companies could be as impactful. Nvidia is expected to benefit from ramping AI spending, but as we’ve seen in the past, its guidance will need to clear whisper guidance expectations to drive the shares higher following its more than 35% gains since late March.

Given the comment about tax refunds and their timing, our focus will be on retailer comments about the back half of the year. We’ve already learned that Chinese suppliers are hiking prices as their factories ramp production for Christmas and the year-end holiday shopping season. We could see a pull forward in holiday shopping as shoppers look to get ahead of higher prices later in the year, potentially making Amazon’s (AMZN) 2026 Prime Day and competing efforts by other retailers a bigger deal this year compared to recent ones.

7. Economic data today per TipRanks: NAHB Housing Market Index (May), Net Long-term TIC Flows (March)

8. Companies reporting today per TipRanks: AM – Baidu (BIDU).

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At the time of publication, TheStreet Pro Portfolio was long AMZN, CIBR and NVDA shares.