Latest / Key Markets & Headlines / Key Markets & Headlines — Friday, May 22, 2026
Transcript
- Key markets and headlines for today. The single most market-moving story this morning comes from the artificial intelligence sector, where a new enterprise services firm backed by Blackstone, Anthropic, and Hellman & Friedman has made its first acquisition. The as-yet unnamed venture has chosen Fractional AI, a San Francisco-based company, as its operational centerpiece. With this move, Fractional AI will end its eleven-month partnership with OpenAI. The new firm is designed to encourage midsize companies to adopt generative AI, specifically leveraging Anthropic’s Claude platform. While the terms of the transaction have not been disclosed, this marks a significant step in the ongoing competition among AI giants and signals a shift in the enterprise AI landscape. Turning to other Allen focus names and corporate news, Coinbase, ticker C-O-I-N, is set to launch the first perpetual-style equity index futures on a US regulated exchange through Coinbase Derivatives. Starting June eighth, traders will have access to four thematic contracts tracking artificial intelligence, China, defense, and the top Nasdaq companies. This move brings a proven structure into a CFTC-regulated framework, offering capital-efficient exposure to some of the most prominent themes in today’s markets. Cursor, an artificial intelligence startup specializing in coding software, has seen its annualized revenue hit three billion dollars as of late April. This is up from two billion in February, reflecting surging demand ahead of a potential acquisition by SpaceX. Cursor now counts more than three thousand customers, each paying at least one hundred thousand dollars annually for its software, which helps programmers write and debug code more efficiently. The company first launched its AI software in twenty twenty-three. DeepSeek, another AI startup, is in the final stages of a massive seventy billion yuan, or ten billion dollar, funding round. Senior management has told potential investors that the company will prioritize groundbreaking AI research over short-term commercialization. Founder Liang Wenfeng has pledged to continue developing open-source AI models, with the broader goal of achieving artificial general intelligence. The funding round, which could value DeepSeek at forty-five billion dollars before the investment, may set a record for a first-time financing by a Chinese tech startup. Likely investors include the National Artificial Intelligence Industry Investment Fund, Tencent Holdings, IDG Capital, and Monolith Capital. In the delivery and mobility sector, Uber has increased its stake in Germany’s Delivery Hero to nineteen point five percent, with an option to go up to twenty-five point one percent. According to Berenberg, this could signal a potential increase in strategic investor involvement, a takeover scenario, or even a breakup of Delivery Hero. With this additional holding, Uber would reach a blocking minority, giving it significant influence over the company’s strategic direction. Waymo, the autonomous vehicle unit of Alphabet, ticker G-O-O-G, has temporarily halted service in five cities due to concerns that its robotaxis may attempt to drive on flooded roads. This follows recent incidents where unoccupied Waymo vehicles entered flooded areas, leading to a recall of nearly four thousand vehicles to address a software issue. Service is currently paused in Atlanta, Austin, Dallas, Houston, and San Antonio. Hark, an AI personal assistant platform startup, has raised seven hundred million dollars in a Series A round at a six billion dollar post-money valuation. The company, led by Brett Adcock, aims to create a universal interface for the digital world that is useful for everyday consumers. The round was led by Parkway Venture Capital and included major investors such as Nvidia, Align Ventures, AMD Ventures, ARK Invest, Brookfield, Greycroft, Intel Capital, Prime Movers Lab, Qualcomm Ventures, Salesforce Ventures, and Tamarack Global. IBM has secured a one billion dollar award from the Trump administration to build a foundry for producing quantum computing chips. IBM will also invest one billion dollars into a new company called Anderon, which will manufacture these processors. The funding is part of a broader two billion dollar support package from the Commerce Department for quantum computing, using resources from the twenty twenty-two Chips and Science Act. The US government will receive minority, non-controlling equity stakes in each of the companies awarded funding. Kalshi, a prediction market platform, is raising an additional two hundred million dollars, expanding a funding round that had already brought in one billion dollars. Baillie Gifford is joining as an investor for the first time, and Layer Global, led by Anton Levy, is in discussions to participate. Liberty Latin America, ticker L-I-L-A, is issuing a special dividend to shareholders in the form of preferred stock rather than cash. For every ten common shares owned, investors will receive one new preferred share valued at twenty-five dollars, equivalent to two dollars and fifty cents per common share. The total value of the distribution is about five hundred million dollars. These preferred shares will pay a nine percent annual dividend in quarterly installments starting in September twenty twenty-six, do not carry voting rights, and are expected to trade separately on Nasdaq under the ticker LILAP. The company expects the distribution to be tax-free for US and UK investors, and senior leadership has indicated they plan to hold these shares long term. LIV Golf, backed by the Public Investment Fund of Saudi Arabia, is seeking between two hundred fifty million and three hundred fifty million dollars in new investment to continue operations beyond twenty twenty-six. The upstart league has been looking for new investors since the Saudi fund pulled back its financial support. LIV Golf’s new business plan aims to operate a ten-event annual schedule and reach profitability after three years. The league has retained Ducera Partners to run the investment process. Live Nation, ticker L-Y-V, is under pressure from state attorneys general, who are asking a court to require the company to divest its Ticketmaster unit to address illegal monopolization of the live music industry. This follows a landmark jury verdict finding that Live Nation illegally dominates ticketing markets and amphitheaters. The states also want to block Live Nation from reentering the primary ticketing market for an unspecified period. Live Nation is seeking to overturn the verdict, and the litigation is expected to continue for several years. Modal Labs, an AI infrastructure startup, has raised three hundred fifty-five million dollars in a Series C round led by Redpoint Ventures and General Catalyst, valuing the company at four point six five billion dollars, up from one point one billion last autumn. CEO Erik Bernhardsson said annualized revenue has surged to three hundred million dollars from sixty million in September. Modal provides AI companies with access to computing chips and offers a sandbox product for developers to test AI-generated code before deployment. Its customer base includes biotech firms, hedge funds, and weather-forecasting companies. The company now works with thirteen cloud providers, up from five last year. Anthropic is reportedly in talks to rent Microsoft AI server chips as it seeks to boost computing power and meet demand for its services. Microsoft, like Google and Amazon, has been designing its own chips to reduce reliance on Nvidia. Anthropic’s Claude models could run on Microsoft’s Maia chips, providing another option for scaling its AI offerings. Last year, Anthropic committed to purchase thirty billion dollars’ worth of computing capacity from Microsoft’s Azure cloud service, while Microsoft and Nvidia agreed to invest a combined fifteen billion dollars in Anthropic. OpenAI, backed by Microsoft, generated approximately five point seven billion dollars in revenue in the first quarter, nearly one billion more than Anthropic over the same period. Growth was driven in part by OpenAI’s coding agent, Codex. However, Anthropic’s recent growth rate could widen the gap between the two AI firms’ revenues by the end of twenty twenty-six. Oura Health, a maker of smart rings that track health, fitness, and sleep, has confidentially filed for a US initial public offering. The company is working with Goldman Sachs, Morgan Stanley, JPMorgan, Allen & Co., and Jefferies on the offering, and plans to go public later this year. Oura reached an eleven billion dollar valuation last September after raising eight hundred seventy-five million dollars in Series E funding. CEO Tom Hale said the company had sold five point five million rings to date and expects revenue to reach one point five billion dollars in twenty twenty-six, tripling the five hundred million generated in twenty twenty-four. Polymarket, a global prediction market platform, has appointed a representative in Japan and is preparing to lobby for the authorization of prediction markets in the country by twenty thirty. Polymarket enables users to bet on the outcomes of real-world events using cryptocurrencies. The push into Japan comes as the company faces legal scrutiny in the US and rising competition from Kalshi and other rivals. Polymarket’s monthly notional trading volume on its offshore exchange and US app totaled ten point three billion dollars in April, a nine percent decline from the previous month. Sweetgreen, ticker S-G, received an upgrade from JPMorgan analyst Rahul Krotthapalli, who raised the stock to Overweight from Neutral and increased the price target to thirteen dollars from eight dollars. The upgrade follows an encouraging meeting with management and reflects Sweetgreen’s aggressive adoption of new products and improvements in supply chain and in-store operations. The stock rose six percent in premarket trading. Snap announced the appointment of Luke Wood, former President of Beats by Dr. Dre and Vice President at Apple, to its board of directors, effective May twentieth. Wood is a co-founder and CEO of Violet St Holdings and brings extensive experience from his leadership roles at Beats and Apple, as well as earlier positions at Interscope Geffen A&M and DGC Records. SpaceX delayed a critical test of its Starship rocket just seconds before launch due to a technical issue with the launch tower arm. The mission was set a day after SpaceX filed publicly for an initial public offering as soon as June, aiming to raise up to seventy-five billion dollars to fund development of the Starship moon and Mars vehicle, the Starlink internet initiative, and a nascent artificial intelligence business. The launch was to debut the third iteration of the rocket, Version Three, which promises major improvements in power and capability. Elon Musk said another launch attempt could take place Friday if the issue is resolved. Spotify announced several new initiatives, including a major AI-generated music licensing deal with Universal Music Group. The agreement will allow Spotify to launch a tool enabling fans to create covers and remixes of songs from participating artists, powered by generative AI. The tool will be available as a paid add-on for Spotify Premium users, with participating artists sharing in revenue from streams of AI-generated covers. In addition, Spotify plans to work with Live Nation Entertainment to offer subscribers the option to purchase two concert tickets before they go on sale to the general public. Stellantis, ticker S-T-L-A, announced a major investment push focused on four core brands as part of a broad reset to boost profitability. The automaker will spend about seventy billion dollars through twenty thirty to launch sixty new models, prioritizing Jeep, Ram, Peugeot, and Fiat. In North America, Stellantis plans to add new compact and midsize pickup trucks and a new entry-level model for Dodge. The group aims to raise returns in North America to as much as ten percent by twenty thirty and achieve six billion euros in annual savings by twenty twenty-eight. Tesla, ticker T-S-L-A, has launched its fully self-driving technology in China after years of efforts to secure approval. The full self-driving system, known as FSD Supervised, is now available in several countries, including China. The software relies on AI-powered learning from millions of video clips rather than preprogrammed rules and sensors. Approval in China is a significant milestone for Tesla’s efforts to boost sales in the world’s largest electric vehicle market and is expected to spur increased competition and technological development among Chinese automakers. Tesla is also recalling nearly fifteen thousand Model Y SUVs due to missing certification labels with weight specifications, according to the US National Highway Traffic Safety Administration. While no collisions, injuries, or fatalities have been reported, the missing labels could lead to overloading and increase the risk of a crash. Tesla will inspect and install the labels on affected vehicles. Penske Media is reportedly in line to acquire the brands left over from Vox Media’s breakup, including Eater, The Verge, SB Nation, Popsugar, and The Dodo. These titles were left behind when James Murdoch acquired New York Magazine, the Vox Media Podcast Network, and Vox for three hundred million dollars. The deal with Penske Media could still fall through, and it is structured as an all-or-nothing operation. Warner Bros. Discovery, ticker W-B-D, is refinancing short-term debt ahead of its planned acquisition by Paramount Skydance. A JPMorgan Chase-led bank group has boosted a leveraged loan offering to ten point two billion dollars, comprised of a nine billion dollar US dollar facility and a one billion euro portion. Such loans are typically repaid at par in the event of an acquisition that changes ownership, and investors have an opportunity to buy the loan at a discounted rate if the Paramount deal is finalized. Workday, ticker W-D-A-Y, posted better-than-expected results in the first quarter, easing concerns about the company’s ability to compete in the AI era. Sales rose thirteen percent to two point five four billion dollars, topping analyst projections. Earnings climbed to two dollars and sixty-six cents a share, also beating expectations. Shares rose about ten percent in extended trading, though they had lost forty-three percent of their value this year. The company also forecast subscription revenue for the second quarter that narrowly topped estimates, and CEO Aneel Bhusri emphasized that Workday is ready for the AI moment. Zillow Group, ticker Z-G, is facing challenges on multiple fronts. BTIG notes that Google is again testing paid listings, which could threaten Zillow’s lead-generation model. Additionally, the Chicago-area Multiple Listing Services Midwest Real Estate Data has pulled listings from Zillow, putting it at a disadvantage in local coverage compared to other portals. BTIG believes Zillow’s dominance in residential real estate is now less certain as competition intensifies. Turning to macroeconomic developments, the European Central Bank is likely to raise interest rates next month to reinforce its commitment to its inflation mandate. ECB Governing Council member Alexander Demarco said that with medium-term inflation expectations still well anchored, there’s currently no need for many follow-up steps. However, a rate hike in June is seen as necessary to preserve credibility and prevent inflation from becoming entrenched, especially in the wake of higher prices due to the war in Iran. Even some of the more dovish ECB officials have indicated support for a rate increase. In the United States, the Pentagon is considering whether to scrap an eighty million dollar conditional loan offer to rare-earths refiner ReElement Technologies, sparking a clash with the White House. The agreement was intended to help break China’s dominance in critical minerals, but officials have raised doubts about ReElement’s ability to scale its technology and meet long-term revenue forecasts. The deal is part of a broader one point four billion dollar critical-minerals agreement that also included Vulcan Elements, and is a key part of the Trump administration’s drive to develop domestic production of rare earth elements. In the United Kingdom, government borrowing reached its highest level for any April in six years, totaling twenty-four point three billion pounds, or thirty-two point six billion dollars. This overshot the forecast by more than three billion pounds and was nearly five billion higher than in April last year. Tax receipts rose, but not as much as expected, while government spending increased due to higher benefit and pension costs linked to inflation and earnings. The figures are unwelcome for Chancellor Rachel Reeves, as the public finances have yet to feel the full impact of the Middle East energy shock. Political instability is also pushing up UK bond yields. In event-driven news, GlobalFoundries has launched Quantum Technology Solutions to scale US quantum manufacturing, with a letter of intent from the US government to award three hundred seventy-five million dollars and receive a one percent equity stake. The new business is launching with customer engagements and a pipeline of quantum innovators positioned to scale on its platform. The Department of Commerce’s investment reflects the national security importance of a domestic quantum manufacturing base. IMAX shares rose following reports that the company is exploring a possible sale. Talks are still preliminary, and no formal bids have been made, but CEO Rich Gelfond has previously indicated openness to a transaction if it creates more value for shareholders. IMAX is coming off a record year, with one point two eight billion dollars in global box office in twenty twenty-five. Moderna’s experimental flu shot, made with mRNA technology, will be reviewed by a Food and Drug Administration advisory panel next month. This marks an increase in transparency after several controversies. The review is scheduled for June eighteenth, with an approval decision expected by August fifth. Earlier this year, the FDA initially refused to review Moderna’s shot, a rare move that surprised Wall Street and the biotech industry. Puig Brands plunged fifteen percent in Madrid after the collapse of a proposed combination with Estee Lauder that would have created one of the world’s largest fragrance and skincare companies. The deal fell apart due to demands from makeup artist Charlotte Tilbury regarding her compensation. Estee Lauder shares jumped as much as sixteen percent after the news, reversing losses that followed the initial announcement of talks. Wall Street analysts had expressed skepticism about Estee Lauder’s ability to integrate additional brands during its own turnaround. Looking at some notable charts and trends, recent strength in the equity markets has been led by large-cap stocks. Historically, when earnings have risen as they have recently, interest rates have always followed, moving higher alongside profits. In the oil market, while price shocks have historically hit US growth, spending on energy consumption is much lower relative to previous periods, which could mitigate the impact of higher oil prices on the broader economy. Another trend to note is that public equities related to the final frontier, such as space exploration, have outperformed their AI-related peers over the past year. In media and entertainment, Netflix, ticker N-F-L-X, will stream “The Breakfast Club,” the influential morning radio show, live starting June first. This marks Netflix’s first daily live program. The show, originating from New York’s Power one oh five point one FM, will air for about three continuous hours each day. Netflix has been expanding into live programming to drive subscriptions, and “The Breakfast Club” accounted for more than forty percent of all Netflix podcast views in the first quarter. The show’s podcast also rose to number eleven on the Edison Podcast Metrics US chart, its highest rank ever. The National Hockey League continues to see record viewership during the postseason’s second round. ESPN averaged two point two million viewers, up seventy-six percent from last year, and the largest figure since the current media rights agreement began. Game seven between Montreal and Buffalo averaged three million viewers, the highest of the playoffs so far. TNT Sports also posted its most-watched second round since beginning its NHL rights in twenty twenty-one, with an average per-game audience of one point nine million viewers. In the real estate and listings sector, BTIG notes that Zillow’s dominance is being challenged as Google tests paid listings and the Chicago-area Multiple Listing Services Midwest Real Estate Data has pulled listings from Zillow. This puts Zillow at a disadvantage in local coverage and raises questions about its long-term leadership in the residential real estate portal space. That wraps up today’s key markets and headlines. Thanks for listening.