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Luke Kawa

IREN surges on $9.7 billion deal to provide AI cloud capacity to Microsoft

IREN is surging this morning after inking an agreement to provide Microsoft with access to Nvidia Blackwell GPUs at a data center campus in Texas over a five-year period.

The total contract value is approximately $9.7 billion, per IREN, and includes a 20% prepayment. Dell also gets a piece of the action here, as Iren will purchase these GPUs as well as other equipment from the server maker for about $5.8 billion.

The bitcoin miner turned data center company said the GPUs will be deployed in phases through 2026.

“It marks another major step forward for IREN as we continue to expand large-scale GPU deployments across our 3GW secured power portfolio in North America, reinforcing our position as a leading AI Cloud Service Provider,” IREN cofounder and co-CEO Daniel Roberts said. He told Bloomberg that the deal accounts for about 10% of IREN’s total capacity.

That “secured power portfolio” reference in Roberts’ remarks is critical, and a key selling point for IREN here.

In a recent appearance on Brad Gerstner’s “Bg2 Pod,” Microsoft CEO Satya Nadella discussed how the key bottleneck for AI deployment doesn’t concern chips, but rather “the ability to get the builds done fast enough close to power. So if you can’t do that, you may actually have a bunch of chips sitting in inventory that I can’t plug in, and in fact, that is my problem today. It’s not a supply issue of chips; it’s actually the fact that I don’t have warm shelves to plug into.”

Jonathan Tinter, president of business development and ventures at Microsoft, echoed those comments in today’s press release, saying: “IREN’s expertise in building and operating a fully integrated AI cloud — from data centers to GPU stack — combined with their secured power capacity makes them a strategic partner.”

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Matt Phillips

Gold tumbles as market sees Fed shifting toward inflation fighting

Gold and gold miners tumbled Thursday, as the rolling Iran war energy crisis revived worries about inflation and pushed the market to take additional rate cuts this year off the table.

Gold (SPDR Gold Shares ETF) futures dropped roughly 6% shortly after 12 pm ET, hammering share prices for miners Newmont and Freeport-McMoRan. Silver (iShares Silver Trust) futures were down nearly 9%

The decline in precious metals came alongside another sharp rise in energy prices. US benchmark crude oil (United States Oil Fund LP) and natural gas prices both jumped more than 3%, after major Iranian attacks on Qatari energy infrastructure. US retail gasoline prices tracked by AAA hit $3.884, up 33% from the end of last month, when a joint US-Israeli attack on Iran ignited hostilities.

Normally, gold prices are seen as a hedge on inflation, which might suggest that they should rise alongside expectations for persistent price increases.

But the speed of the Iran war energy shock — which will add to inflationary pressures already visible in recent economic reports such as this week’s Producer Price Index and could become a political problem for the Trump administration — has nudged traders to change their their views on whether the Federal Reserve would be able to deliver rate cuts widely expected just a few weeks ago.

Yields on shorter-maturity US Treasury notes shot higher Thursday — reflecting expectations for tighter monetary policy. And prices in the market for Fed Funds futures suggest traders no longer see the US central bank cutting interest rates this year at all. (Early this month, market pricing implied expectations for two more cuts this year.)

On Thursday yields fell on longer-term US government securities, such as the US 30-year bond. That suggests the market thinks a Fed shift toward inflation-fighting and away from rate-cutting would likely result in some decline in growth and, or inflation, helping to explain the drop in precious metals prices, as there would be less of a need for inflation hedges in such a scenario.

Bond Traders No Longer Price In Any Chance of Fed Cut in 2026

Bond Traders No Longer Price In Any Chance of Fed Cut in 2026

The decline in precious metals came alongside another sharp rise in energy prices. US benchmark crude oil (United States Oil Fund LP) and natural gas prices both jumped more than 3%, after major Iranian attacks on Qatari energy infrastructure. US retail gasoline prices tracked by AAA hit $3.884, up 33% from the end of last month, when a joint US-Israeli attack on Iran ignited hostilities.

Normally, gold prices are seen as a hedge on inflation, which might suggest that they should rise alongside expectations for persistent price increases.

But the speed of the Iran war energy shock — which will add to inflationary pressures already visible in recent economic reports such as this week’s Producer Price Index and could become a political problem for the Trump administration — has nudged traders to change their their views on whether the Federal Reserve would be able to deliver rate cuts widely expected just a few weeks ago.

Yields on shorter-maturity US Treasury notes shot higher Thursday — reflecting expectations for tighter monetary policy. And prices in the market for Fed Funds futures suggest traders no longer see the US central bank cutting interest rates this year at all. (Early this month, market pricing implied expectations for two more cuts this year.)

On Thursday yields fell on longer-term US government securities, such as the US 30-year bond. That suggests the market thinks a Fed shift toward inflation-fighting and away from rate-cutting would likely result in some decline in growth and, or inflation, helping to explain the drop in precious metals prices, as there would be less of a need for inflation hedges in such a scenario.

markets
J. Edward Moreno

Novo says FDA has approved high-dose Wegovy shot

The Food and Drug Administration approved Novo Nordisk’s high-dose Wegovy shot, the company announced on Thursday.

Wegovy HD, a once-weekly 7.2-milligram injection, helped patients lose 20.7% of their body weight after 72 weeks, putting it in line with Eli Lilly’s competitor drug, Zepbound. By comparison, Wegovy typically has a maximum dose of 2.4 milligrams, which resulted in 15% weight reduction over 68 weeks in trials.

Wegovy HD was the first drug to be approved through the FDA’s new priority voucher system. This comes as Novo, despite being early to the GLP-1 boom, has been outpaced in sales by Lilly. The company released a pill version of Wegovy in January, which has shown strong early uptake, though new competitor products are set to debut this year and next.

The stock is down about 1.6% for the day, but was down nearly 3% before the announcement.

Tasha Matsumoto
Crudely speaking
2h
What we talk about when we talk about crude oil

While both WTI and Brent are light and sweet crude, differences in geography and chemical composition influence the Brent-WTI spread.

ODESSA, TEXAS - APRIL 27: Pump jacks working on the Permian Basin near Odessa
markets
Matt Phillips

Intuit, Workday jump amid Iran war fueling flight-to-software trade

Cash flow positive software companies — the same ones that were seen as doomed to obsolescence by AI a few weeks back — jumped Thursday, with Oracle, Workday, Intuit, and Salesforce staying above water despite the general downtrend in the big indexes.

Some of the uptick is likely linked to the better-than-expected weekly jobless claims numbers that came in early today, which eased concerns about a recession brought on by the most recent monthly employment report. (Payroll-processing stocks like Paycom Software, Paychex, and Automatic Data Processing are clearly breathing a sign of relief.)

And given that these software companies often have a “seat-based” revenue model, the fact that human butts are not rapidly being replaced by AI-enhanced robot keisters gives them a lift as well.

Also as we’ve said before, amid the chaos and uncertainty of the Iran war, the steady cash flows and predictable short-term outlook of software-as-a-service stocks have a definite appeal.

Even if you think that over the long term AI will end up slaughtering these cash cows, that’s a problem for a day perhaps three to five years in the future, whereas the Iran war is a growing risk investors increasingly can’t ignore today.

markets
Matt Phillips

Rocket Lab slips with other momentum stocks despite DOD hypersonic test deal, new analyst “buy” call

Rocket Lab slipped early Thursday along with other momentum stocks, despite announcing a new $190 million deal for 20 tests of hypersonic rockets for the Department of Defense and picking up a new bullish analyst call.

The commercial space launch company called the deal to launch 20 hypersonic test flights over a four-year period in collaboration with Kratos Defense its “single largest launch agreement yet.”

Separately, analysts at brokerage firm Clear Street initiated coverage of Rocket Lab with a “buy” rating and an $88 price target — essentially the same as Wall Street’s $88.38 consensus, according to FactSet. That implies upside of about 27% for the stock compared to yesterday’s close. Clear Street analysts wrote:

“Despite shares rising 289% (vs. 26% for the NASDAQ) over the past year, we see further upside. Our $88 target is based on 20x 2030E EV/Sales, in line with the ~30x NTM EV/Revenue average over the past year when discounted to present value. We anchor on 2030E to capture the payoff from ~16 annual Neutron launches following a multi-year investment cycle. Our outlook incorporates estimated dilution and proceeds from the $1B equity distribution agreement announced on 3/17/2026.”

The favorable headlines for Rocket Lab weren’t enough to help the shares overcome a general downdraft for high-beta momentum stocks such as itself. They are getting hammered early on the deteriorating situation in the Mideast war.

Rocket Lab wins $190 million Pentagon deal for hypersonic test flights

Rocket Lab wins $190 million Pentagon deal for hypersonic test flights

Separately, analysts at brokerage firm Clear Street initiated coverage of Rocket Lab with a “buy” rating and an $88 price target — essentially the same as Wall Street’s $88.38 consensus, according to FactSet. That implies upside of about 27% for the stock compared to yesterday’s close. Clear Street analysts wrote:

“Despite shares rising 289% (vs. 26% for the NASDAQ) over the past year, we see further upside. Our $88 target is based on 20x 2030E EV/Sales, in line with the ~30x NTM EV/Revenue average over the past year when discounted to present value. We anchor on 2030E to capture the payoff from ~16 annual Neutron launches following a multi-year investment cycle. Our outlook incorporates estimated dilution and proceeds from the $1B equity distribution agreement announced on 3/17/2026.”

The favorable headlines for Rocket Lab weren’t enough to help the shares overcome a general downdraft for high-beta momentum stocks such as itself. They are getting hammered early on the deteriorating situation in the Mideast war.

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