US and Iran Reach Preliminary Deal; Dell Soars on Outlook

0:00Did you know that passive fixed income ETFs only capture about 50 % of the US public bond market? But with JPMorgan Asset Management's active fixed income ETFs, we can help you capture 100 % of the U.S. public bond market and explore twice as many opportunities. Visit jpmorgan.com slash get active to learn more. JPMorgan Asset Management is the brand name for the asset management business of JPMorgan Chase & Co. and its affiliates worldwide. This communication is issued by JPMorgan Distribution Services, Inc., member of FINRA. The thing about AI for business, it may not automatically fit the way your business works.

0:36At IBM, we've seen this firsthand. But by embedding AI across HR, IT, and procurement processes, we've reduced costs by millions, slash repetitive tasks, and freed thousands of hours for strategic work. Now we're helping companies get smarter by putting AI where it actually pays off, deep in the work that moves the business. Let's create smarter business, IBM. Find home wherever you roam at Sinesta ES and Simply Suites, where longer stays feel comfortable, flexible, and easy. Stretch out and enjoy spacious accommodations and home-like amenities designed to help you settle in and stay productive or relaxed for however long you need.

1:16And when you're a Sonesta Travel Pass member, staying at Sonesta ES and Simply Suites means earning points toward free nights, upgrades, and more with every eligible stay. Go to sonesta.com to book your stay and unlock the best rates with Sonesta Travel Pass. Here today, roam tomorrow. Join now at Sinesta.com. Terms and conditions apply. Bloomberg Audio Studios. Podcasts. Radio. News.

1:47Good morning. I'm Karen Moscow. And I'm Alexis Christophorus. Here are the stories we're following today. Alexis, the U.S. and Iran have reached a tentative agreement to extend their ceasefire by 60 days. Sources say further talks on Tehran's nuclear program would continue during the extension period. While the agreement has yet to be signed off by President Trump, the news has raised hopes that the three-month conflict could be nearing a resolution. Vice President J.D. Vance told reporters that progress is being made. If you look at what we've already accomplished here, assuming that we're able to get to a final agreement here, we're reopening the straight-to-form news, we've already decimated their conventional military, and we're in a position where we could substantially set back their nuclear program, not just during the term of this president, but over the long term.

2:35That's a very, very good thing for the American people. So we're not there yet, but we're very close. We're going to keep on working at it. Vice President J.D. Vance says Iran appears to be negotiating in good faith, and we get more on the deal with Bloomberg Middle East correspondent Jumana Persechi. Certainly we've been here before. There have been multiple reports of the two sides edging closer and closer and closer to the deal. the reaction in the market becomes less pronounced. I would say, though, that this time does feel a little bit different because you have so many Gulf Arab states also participating in the mediation attempts.

3:06And it seems as though from the language of the likes of the Treasury Secretary, Scott Bassett overnight, J.D. Vance as well, that this time we really are very, very close. Bloomberg Middle East correspondent Yamana Bersechi says the proposal would guarantee that shipping through the Strait of Hormuz remains unrestricted. And Karen, that news has oil once again lower this morning. Right now, we've got Brent trading at 93.30 a barrel. West Texas Intermediate crude at 88.25 the barrel. Crude has weakened in May on speculation that some form of a peace deal would be reached between the U.S. and Iran.

3:41Brent is down about 19 percent this month. That's its biggest monthly drop since 2020. Well, Alexis, we are following another developing story this morning. Blue Origin's new Glenn rocket has exploded in a massive fireball while undergoing a test on a Florida launch pad. It's a major setback for the Jeff Bezos-backed firm in its efforts to challenge SpaceX. Benedict Camel is Bloomberg's managing editor for Space and Aviation. No harm to human life, it should be said. So this happened during sort of the fueling sequence. They were preparing for a launch in the next couple of days. We've heard from Jeff Bezos, who's called it a very rough day, but he's also vowed to rebuild whatever was broken.

4:23He said it's worth it. It's a reminder that space is hard, and getting rockets up there are complicated, and things do go wrong. Bloomberg's Benedict Hamill says the firm was preparing the vehicle for its fourth launch, which was slated to deploy a batch of satellites for Amazon's LEO, a rival network to SpaceX's Starlink. None of the satellites were on the rocket when it exploded. And Karen, Bloomberg News has learned SpaceX is cutting its valuation goal in its impending IPO. John Tucker joins us now with the very latest. Good morning, John. Good morning, Alexis. Yeah, it's a little more down to earth.

4:59Our sources tell us the company now targeting a valuation of$1.8 trillion. That's down from the$2 trillion the sources told us about last month. This target settling lower after consultations with advisors and investors. SpaceX is expected to start formal marketing of its IPO as soon as June 4th at a price as early as June 11th. Now, details of an IPO like size and valuation are typically adjusted ahead of the pricing based on feedback from stakeholders. The company still seeking to raise as much as$75 billion, which would make it the biggest IPO of all time. In New York, I'm John Tucker, Bloomberg Radio.

5:38All right, John, thanks. Well, Anthropics says it's raised$65 billion in a funding round that now values the company at$965 billion, including the new investment. This valuation surpasses rival OpenAI's value for the first time. And we turn now to the markets where stocks begin the last trading day of the week at record highs. In fact, the S &P 500 is on track for its ninth consecutive week of gains. Daryl Cronk is chief investment officer of Wealth and Investment at Wells Fargo. Last four years, you know, you've got earnings growth of almost 70 percent and prices are up about 75 percent. So I do think if earnings can sustain here, that along with the M &A cycle, we know the story on CapEx.

6:21We know what's coming in front of us in IPOs later this summer and into the fall. There's a lot of things that are triggering some pretty good signs here on the intermediate term. Wells Fargo's Daryl Kronk, during this nine-week rally, the S &P 500 has gained 19%. Well, Alexa, shares of Dell are soaring to an all-time high this morning. The stock up 38 % in early trading. The hardware maker gave an outlook for annual sales that far surpassed analyst estimates. It's being fueled by demand for servers that power artificial intelligence work. Brody Ford covers Dell for Bloomberg. Well, it's all about these servers, right?

6:58I think when some of us think about AI revenue, we think about people selling large language models. But it's a lot more than that, right? I mean, somebody needs to build those servers that go into data centers to train all those models and deploy all the applications. And Dell, a lot of us think of as the kind of boring laptops and computers, but they've managed to really reinvent themselves as physical infrastructure provider for the AI boom. And so, you know, we're seeing some pretty comical revenue ramp here. And Bloomberg's Brody Ford notes that ahead of this morning's surge, shares of Dell were already up more than 150 percent this year.

7:33Well, on the flip side of that, Karen, we've got shares of Gap down about 15 percent here in early trading. The retailer lowered its sales outlook due to struggles with its product mix. Gap's brands include its namesake, as well as Banana Republic, Old Navy and its athleisure chain, Athleta. Alexis, retailer Costco has reported higher than expected profit in the latest quarter, showing the club chain continues to gain ground among cautious U.S. shoppers. Costco has picked up market share in recent years by offering competitive prices and large pack sizes. Gasoline, frequently priced lower at Costco than at competitors, is another advantage as consumers look to cushion a global surge in fuel costs.

8:12And Disney has complied with the Federal Communication Commission's order to file for early license renewals for its eight owned and operated ABC broadcast stations but call the demand unconstitutional. The licenses had been set to expire in 2031. The FCC said last month it was going to seek early reviews of the station licenses due to concerns about Disney's diversity and inclusion programs. Disney says the FCC is targeting ABC to suppress speech and content that the administration finds objectionable. The stations involved are mostly in big markets, such as WABC here in New York and KABC in Los Angeles.

8:51508 on Wall Street. Time now for a look at some of the other stories making news in New York and around the world. For that, we're joined by Bloomberg's Michael Barr. Good morning, Michael. Good morning, Alexis. Kenyan High Court has temporarily blocked the government from approving a deal with the U.S. to establish an Ebola quarantine facility in the East African nation. Parties will make oral arguments before the judge on June 2nd. The Trump administration is working to get a 50-bed temporary facility in Kenya to quarantine any Americans exposed to Ebola. Former White House COVID-19 response coordinator Dr.

9:26Ashish Jha calls the Kenya operation a huge mistake. I actually worry what's going to happen is there are going to be volunteers there who might have an exposure, who are going to be tempted to not acknowledge it because they know if they do, they're going to be stuck in some camp in Kenya and they're going to take their chances come back to America. And this will increase the likelihood that we're going to see Ebola in the U.S. paradoxically. Dr. Jha also says the cuts in USAID have definitely made a difference. More than 200 people have died of Ebola in the Democratic Republic of Congo. An explosion and fire at a Dallas apartment building killed a child and at least two other people.

10:06At least five people suffered injuries. Firefighters have been searching the scene by hand and some areas would require excavation. Deputy Fire Chief Mark Berry. We have gone from rescue mode to recovery mode. We are still actively in recovery mode. Deputy Fire Chief Mark Berry says his department responded to a report of a gas leak at the complex. Martina McBride, Morris Day, the Commodores and Young MC have all announced they will not perform at the Great American State Fair on Washington's National Mall. President Trump launched Freedom 250 last year to celebrate the nation's 250th birthday.

10:44Global news 24 hours a day and whenever you want it with Bloomberg News Now. I'm Michael Barr and this is Bloomberg. Thanks Michael. Time now for our Bloomberg Sports Update and for that we bring in John Stashauer. Thanks Karen. Game 6 of the NBA's Western Conference Finals and in San Antonio, the Spurs never trailed. They had a 20-0 run in the third quarter. They blew out the Thunder, 118-91. The series is going to a Game 7 tomorrow night at Oklahoma City. Third round starts today at the French Open. Among those in action, Novak Djokovic. He's 39 years old, but this may be his best chance to win his 25th career Grand Slam because Carlos Alcaraz isn't playing.

11:24He's injured. Yannick Sinner yesterday lost. That's your Bloomberg Sports Update. Stay with us. More from Bloomberg Daybreak coming up after this.

11:57management business of JPMorgan Chase & Co. and its affiliates worldwide. This communication is issued by JPMorgan Distribution Services Incorporated, member of FINRA. The thing about AI for business, it may not automatically fit the way your business works. At IBM, we've seen this firsthand, but by embedding AI across HR, IT, and procurement processes, we've reduced cost by millions, slash repetitive tasks and freed thousands of hours for strategic work. Now we're helping companies get smarter by putting AI where it actually pays off, deep in the work that moves the business. Let's create smarter business, IBM.

12:36If you follow markets, you know the value of long-term thinking. You plan, you diversify, you prepare for volatility. But even the best strategies can't prevent every bad day. For more than 75 years, Cincinnati Insurance has helped individuals and businesses navigate tough moments with expertise, personal attention, and independent agents who focus on relationships, not transactions. The Cincinnati Insurance Companies. Let them make your bad day better. Find an agent at CINFIN.com.

13:15coast to coast on Bloomberg radio nationwide on Sirius XM and around the world on Bloomberg.com and the Bloomberg business app this is Bloomberg Daybreak and sources tell Bloomberg the U.S. and Iran have reached a preliminary deal to extend a ceasefire by 60 days and discuss the future of Iran's nuclear program Treasury Secretary Scott Besson spoke to reporters from the White House press room yesterday. President Trump has made it very clear, he talked about it at the cabinet meeting, that he has several red lines and Iran has to turn over their highly enriched uranium. They cannot pursue a nuclear weapon.

13:53And Treasury Secretary Scott Besson also mentioning the reopening of the Strait of Hormuz. And for more, we're joined by a Bloomberg Middle East correspondent and anchor of Bloomberg Horizons, Jumana Bersechi. Jumana, good morning. What do we know about this deal and where it stands. Yeah, that's right. So Bloomberg, our Bloomberg colleagues, alongside other news outlets, Axios included, have suggested that the two sides have papered over enough differences to reach an interim agreement. This would be a memorandum of understanding, an MOU, that would entail a 60-day extension to the ceasefire, during which the first 30 days, Iran would commit to an unconditional reopening of the straits, a demining of the straits in exchange for some form of economic relief.

14:40And that is a big sticking point because we just don't know yet what sort of sanctions relief or unfreezing of assets that the U.S. are willing to offer over that time frame. But then over the course of that 60 days, the two sides would also move on to a more formal negotiation process around the nuclear file. And as you just played in the introduction there, Treasury Secretary Besant reiterating what Trump's red lines are there and that Iran have to commit to not pursuing a nuclear weapon and also in turn have to commit to somehow disposing or destroying or handing over, diluting their stockpile of highly enriched uranium.

15:17So are there any early indications that this is being well received by President Trump and Iran? Well, I think President Trump has to make the decision here. In our own reporting, we also cite that President Trump has to sign off on this deal. The mood music coming out from both sides is certainly very positive. But at the same time, you know, J.D. Vance saying that there are still some significant nuclear hurdles that need to be overcome. The Iranian president, Masoud Pazeshkian, saying that they are committed to the diplomatic process. So in all likelihood, what's going to happen if we do get a breakthrough is we will get this one page memorandum.

15:58And remember, this isn't a fully fledged, comprehensive peace deal. We're just going to get a piece of paper that would commit to an extension of the ceasefire. And then the thornier and more prolonged discussions around the nuclear file will begin. And remember, around the JCPOA, around the Obama time, it took almost two years to get a nuclear deal across the line. So that is what perhaps we may be in for. But as far as markets are concerned, any talk about an imminent reopening of the straits would be perceived to be very constructive, obviously. And just quickly here, I have to ask about Israel because it's been stepping up its attacks on Lebanon.

16:36So how does Israel play into this? Yes. Well, on one hand, the Israeli prime minister says he's in constant dialogue with President Trump and Iran had been trying to weave back in the Lebanon story into the bigger file. So that was also one of the earlier sticking points that we mentioned this week. We'll see whether Lebanon does have a mention in the ceasefire. The White House has maintained the position that the two files are separate. And even today, even as we speak about the idea of ongoing strikes in Beirut, there's still military discussions taking place within the State Department about the future of Lebanon.

17:13So separate tracks for now. This is Bloomberg Daybreak, your morning podcast on the stories making news from Wall Street to Washington and beyond. Look for us on your podcast feed by 6 a.m. Eastern each morning on Apple, Spotify or anywhere else you listen. You can also listen live each morning starting at 5 a.m. Wall Street time on Bloomberg 1130 in New York, Bloomberg 99.1 in Washington, Bloomberg 92.9 in Boston, and nationwide on Sirius XM Channel 121. Plus, listen coast to coast on the Bloomberg Business app now with Apple CarPlay and Android Auto interfaces. And don't forget to subscribe to Bloomberg News Now.

17:53It's the latest news whenever you want it in five minutes or less. Search Bloomberg News Now on your favorite podcast platform to stay informed all day long. I'm Karen Moscow. And I'm Alexis Christophorus. Join us again tomorrow morning for all the news you need to start your day right here on Bloomberg Daybreak.

18:14If you follow markets, you know the value of long-term thinking. You plan, you diversify, you prepare for volatility. But even the best strategies can't prevent every bad day. For more than 75 years, Cincinnati Insurance has helped individuals and businesses navigate tough moments with expertise, personal attention, and independent agents who focus on relationships, not transactions. The Cincinnati Insurance Companies. Let them make your bad day better. Find an agent at CINFIN.com. Sonesta Travel Pass makes traveling more rewarding, designed to help you get more out of every stay. Sign up at Sonesta.com to enjoy instant savings, bonus points, and valuable perks like early check-in, late checkout, room upgrades, and free stays over time.

19:05With Sonesta Travel Pass, every stay brings you closer to your next reward. Choose from more than 1 ,100 hotels across 13 distinctive brands and unlock the best available rates when you book direct with Sonesta Travel Pass. Here today, roam tomorrow. Join now at Sonesta.com. Terms and conditions apply. Game night rush, or any night of the week really, Genius keeps every order moving. From online ordering to your kitchen to the front counter. Big league reliability for any business. That's Genius.