OpenAI Files for IPO: 8 Key Items Shaping the Stock Market Tuesday

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, equity futures point to a positive start to the trading day when U.S. markets open later on Tuesday morning.

1. The Israeli military struck towns and villages across southern Lebanon on Tuesday, testing the shaky two-month cease-fire again just a day after direct hostilities between Iran and Israel threatened to unravel the truce. The latest attacks came after Iran halted strikes against Israel on Monday, but threatened to reignite the war with “harsher and more forceful actions” if Israel resumed its “aggression and hostile acts,” including in southern Lebanon. (NY Times)

That was a short-lived halt between Israel and Iran and suggests a tenuous nature of U.S.-Iran peace talks. On Monday, reports shared comments from President Trump that the U.S. and Iran were within days of a breakthrough clearing the way for talks on a long-term nuclear deal. We continue to be optimistic about peace talks, but we will remain mindful of potential risks, positioning TheStreet Pro Portfolio accordingly.

2. An index of US small business optimism fell in May to the lowest level since October 2024, erasing almost all of the gains seen since President Donald Trump was elected for a second term. The National Federation of Independent Business optimism index fell 0.6 point to 95.3, according to data out Tuesday. The measure had climbed to a six-year high in December 2024 following the presidential election. Rising prices and economic uncertainty due to the Iran war continue to hang over companies. Seventy percent of small business owners reported that supply chain disruptions affected their business to some extent, up 6 points from April. The share of owners citing inflation as their most important business problem climbed for a third straight month. (Bloomberg)

The national average gas price may have fallen to $4.16 per gallon on Tuesday, per data from AAA, down from $4.53 a month ago, but it is still up about 33% compared to this time last year. But the findings of the NFIB’s latest Small Business Optimism Index point to growing supply chain problems as well as inflation pressures. As we learned from the pandemic, the longer the supply chain disruptions last, the longer it will take to unwind them.

And with that in mind…

3. BASF SE Chief Executive Officer Markus Kamieth said rising inflation and the risk of supply-chain disruption from the US-Israeli conflict with Iran have darkened the outlook for both the auto sector and the broader economy. Shortages of materials are becoming more likely and could halt tightly run supply chains such as car production… “That’s a downside risk that I can see for the second half of this year,” Kamieth said. “There is this creeping risk that at some point a material won’t be available.” (Bloomberg)

The comment from Kamieth, along with renewed inflation pressures plus moves by companies to protect margins that are yet to be captured in reported inflation metrics, adds to our questioning of the 2H 2026 consensus EPS for the S&P 500. As of June 5, data cataloged by FactSet still shows 2026 consensus EPS up more than 24% compared to 2025, with 2H 2026 EPS up 23% compared to 2H 2025.

The question we’re pondering is this: Given the inflation data we’re seeing paired with supply chain issues, what is the factor that will drive that 2H 2026 EPS growth figure to climb from the 21% figure the market sees for the current quarter, which is slower than the 27% figure for Q1 2026?

Recognizing the nature of the S&P 500 basket, TheStreet Pro Portfolio will continue to position itself to capture where capital, be it from companies, consumers or other entities, is being spent.

And with that said…

4. Apollo and Blackstone have finalised a $35bn private credit deal that will help finance Anthropic’s growth plans, as banks and investment groups across Wall Street pour capital into the AI boom. The two private investment groups led the financing, one of the largest private credit deals completed, which will fund Anthropic’s purchase of Alphabet-developed chips. (FT)

The package, one of the biggest private credit transactions in history, highlights the race by top-tier financiers to fund data center construction and the chips they use. Tech companies are tapping every corner of the credit markets to meet AI’s unprecedented capital demands… (Bloomberg)

Shares of Broadcom (AVGO) slumped last week, and in our post-earnings discussion, we laid out our game plan for the shares as we lifted both our price target and investment rating. The completion of this private credit deal brings support for Broadcom’s comment last week that its 2027 AI chip revenue figure of more than $100 billion “is on the same trajectory as we are seeing in the back half of ’26.” It also gives us another reason to think Broadcom’s 2H 2026 guidance is conservative.

5. Apple shares were edging down early on Tuesday as investors digested its artificial-intelligence plans, which raised some questions among analysts. (Barron’s)

After watching the WWDC Keynote reveal for the revamped Apple Intelligence and Siri AI, we were less than impressed. We discussed why that was our takeaway, but we also shared our view as to why Apple’s (AAPL) new beta software releases will give us a far better picture of consumer reception for the new Apple Intelligence and Siri AI. If you missed those comments, you can find them here.

6. OpenAI confidentially filed for a U.S. initial public offering recently, the ChatGPT maker said on Monday, joining rival Anthropic in a push toward a stock market listing as it looks to tap into insatiable investor demand for AI shares. OpenAI did not disclose the size or terms of the offering, and said a timeline has not yet been determined. “It ‌may be a while because there are things we want to do that are likely easier as a private company,” it said in a statement. (Reuters)

OpenAI’s Sam Altman will say what he will about IPO timing, but we continue to think there will be a race to go public between OpenAI and Anthropic. The reality is that both transactions are at least a few months away, and that will afford us ample time to read their S-1 registration statements when filed publicly.

Capital spending plans will be something we focus heavily on given holdings within the Portfolio, and because of our position in SuRo Capital (SSSS) and its investment in OpenAI, we will be tracking that one rather closely. When we read those S-1 filings, we’ll be sure to read them alongside the IPO filing for SpaceX (SPCX). And yes, the performance of that IPO will probably have an impact on price talk for OpenAI and Anthropic’s offerings. We will also continue to track the larger IPO market and M&A activity given the Portfolio’s positions in Morgan Stanley (MS) and Bank of America (BAC).

7. Economic data today per TipRanks: NFIB Small Business Optimism Index (May), ADP Employment Change Report (Weekly), Imports/Exports (April), Existing Home Sales (May), Wholesale Inventories (May)

8. Companies reporting today per TipRanks: AM – JM Smucker (SJM), SailPoint (SAIL), United Natural Foods (UNFI). PM – Casey’s General (CASY), Cracker Barrel (CBRL).

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At the time of publication, TheStreet Pro Portfolio was long AAPL, AVGO, BAC, GOOGL, MS and SSSS.