Oil prices abruptly reversed course Thursday afternoon on news that the US and Iran may be only hours away from announcing terms for peace negotiations.

Futures on Brent crude (BZ=F), the international benchmark, fell to a loss of 2.6%, trading around $102.30 per barrel after gaining as much as 3.5% in the other direction on the news. Those on US benchmark WTI crude (CL=F) fell to a loss of 2.5% to trade below $96 after rising as much as 4% earlier in the session.

The US and Iran have reached an agreement, mediated by Pakistan, that includes a full ceasefire, “freedom of navigation” in the Persian Gulf and Strait of Hormuz, and a gradual lifting of economic sanctions on Iran, the Iranian semi-official news agency ILNA said in a post on Telegram.

While the post from the ILNA made no mention of Iran’s nuclear enrichment program, it stated that negotiations on “outstanding issues” would begin within seven days.

Oil prices had spiked to start the day after Iranian Supreme Leader Mojtaba Khamenei said the regime’s stores of enriched uranium shouldn’t be sent abroad, throwing a wrench into dealmaking between the US and the Islamic Republic.

Prices spiked Thursday morning after Reuters reported that the supreme leader had issued an edict saying the regime’s stores of uranium enriched to near-weapons-grade levels should not be sent outside Iran.

The development complicates negotiations between Iran and the US, where the White House has said the removal of Iran’s enriched uranium supply is a key red line for any deal.

Federal Reserve Bank of Richmond president Tom Barkin said the recent litany of supply shocks to the US economy is testing the central bank’s capacity to look through inflation increases — but that for right now, the Fed’s wait and see approach is the right call.

“Raising rates to weaken demand doesn’t address the root cause behind supply shock-driven inflation,” Barkin said in a speech in North Carolina. “It doesn’t free up trade routes, reopen factories, or melt ice.”

As the closure of the Strait of Hormuz has wracked energy markets and sent the wider commodities complex on metals, food, fertilizers, and other products surging, the Federal Reserve has kept interest rates steady.

But Wall Street economists and market participants are increasingly moving predictions toward a rate hike as the next move, instead of the cuts expected at the start of the year. Inside the Federal Reserve, a majority of members highlighted that “some policy firming” — Fed-speak for rate hikes — would likely become appropriate if inflation were to continue to run persistently above the Fed’s 2% goal.

Roughly 60% of traders see rates ending the year higher than they are now, according to CME data.

Barkin said he’s concerned the US economy is entering a new era that will be categorized by more frequent supply shocks as geopolitical tension, a breakdown in the global trade order, rising government debt, and other factors ripple through the economy

“If that occurs, does the Fed have the luxury of riding out all the waves that come our way?” Barkin said. “For me, it comes down to how much businesses, consumers, and inflation expectations can take.”.

He said the Fed’s policy stance now is “well-positioned” to respond throughout the rest of the year.

Nvidia (NVDA) expects $20 billion in revenue this year from the sale of both standalone CPUs and CPU servers, CFO Colette Kress told Yahoo Finance on Thursday, providing clarity on a number that caught attention on Wall Street during the company’s earnings call on Wednesday.

Yahoo Finance’s Dan Howley reports:

On Thursday, CFO Colette Kress told Yahoo Finance that the company expects to see $20 billion in revenue from the sale of both standalone CPU (central processing unit) servers and CPUs, including in Nvidia’s Grace Blackwell and Vera Rubin superchips.

“We now have an opportunity to also have what we call a standalone CPU, and selling that,” Kress said during an interview with Yahoo Finance.

“We have customers already looking at the opportunity…along with our Vera Rubin and Grace Blackwell together. That together, we believe, for this year, can be a total of $20 billion of CPUs,” she added.

Kress’ comments add clarity to CEO Jensen Huang’s statement during the company’s earnings call, noting that standalone CPU sales would bring in $20 billion.

All totaled, Huang said the CPU market represents a $200 billion opportunity for Nvidia.

Read more here.

While fears of mass displacement by artificial intelligence have wracked the labor market in recent months, the technology may actually do the opposite, increasing jobs instead of replacing them, LPL Financial chief economist Jeffrey Roach said.

Roach cited the Jevons paradox, the idea that when technology makes the use of a given resource more efficient, demand can rise rather than fall because lower costs open up more use cases and wider adoption.

“AI may reduce the time and cost required to perform many tasks, but that does not necessarily imply a proportional decline in labor demand,” Roach said.

“Instead, by making tasks, software development, customer service, research, and operations more productive, AI can expand the volume of work organizations are able to undertake and create demand for new roles, new products, and new business models.”

Instead of mass replacement, Roach said, AI is likely to reallocate tasks instead of displacing humans. He cites medical diagnostic imaging centers as one example, where, instead of displacing workers, the lower cost of service has expanded demand and led to more hiring at such firms.

Roach also said that AI could fill the gap left in the labor market by an aging population, as more people move into retirement, shrinking the pool of available labor. Working-age people are expected to make up around 62% of the total population by 2050, and less than 60% by 2070, per LPL data.

In that scenario, Roach said, AI is “viewed as a way to fill that gap by boosting how much each worker can produce rather than relying on a larger workforce.”

Oil prices spiked on Thursday after Iranian Supreme Leader Mojtaba Khamenei issued a directive stating that the country’s supply of near-weapons-grade uranium can’t be removed from the country, complicating US-Iran negotiations.

Futures on Brent crude (BZ=F), the international benchmark, rose by as much as 3.5% to trade over $108.50 per barrel before paring gains, while those on US benchmark WTI crude (CL=F) gained as much as 4% to cross over $102 before pulling back slightly.

Prices spiked Thursday morning after Reuters reported that the supreme leader had issued an edict saying the regime’s stores of uranium enriched to near-weapons grade levels should not be sent outside Iran. The development complicates negotiations between Iran and the US, where the White House has said the removal of Iran’s enriched uranium supply is a key red line for any deal.

Trump has repeatedly stated his belief that Iran can’t develop nuclear weaponry and that the US must dismantle the country’s enrichment program for any deal to go through. He has reportedly personally assured Israeli leaders that any deal must include the removal of the uranium stores, per Reuters.

Read more here.

The US stock market opened into the red on Thursday after Iran’s supreme leader said the country’s near-weapons-grade uranium can’t leave the country, sparking renewed unease around potential peace deals.

The Dow Jones Industrial Average (^DJI), benchmark S&P 500 (^GSPC), and tech-heavy Nasdaq Composite (^IXIC) all fell roughly 0.5%.

In the oil market, futures on Brent crude (BZ=F), the international benchmark, rose roughly 2% to trade over $107 per barrel, while those on US benchmark WTI crude (CL=F) gained 2.8% to cross back over $100, after the supreme leader’s comments.

Nvidia’s (NVDA) earnings remained in focus after publishing Wednesday evening, beating expectations on the top and bottom lines.

Elsewhere in the corporate world, Walmart (WMT) reported above estimates on revenue and earnings per share on Thursday. Ross Stores (ROST), Workday (WDAY), and Zoom Communications (ZM) will also report earnings on Thursday.

Carmaker Stellantis NV (STLA) is launching a turnaround plan that will elevate four core brands while sidelining others like Chrysler, the company announced Thursday morning.

Moving forward, Stellantis will concentrate its investments on Jeep, Ram, Peugeot, and Fiat. The company said it believes the move will raise returns by as much as 10% in North America and as much as 5% in Europe by 2030.

Those returns would compare to a 2.5% return on the previous quarter.

The company will invest roughly $70 billion through 2030, with roughly 70% of that spending expected to go to Jeep, Ram, Peugeot, and Fiat, Bloomberg reported, while investments in Chrysler, Dodge, and other brands will be pared back.

The restructuring plans come after news on Tuesday that Stellantis (STLA) and Jaguar Land Rover struck a nonbinding agreement to explore shared product and technology development in the US, the latest in a string of cross-brand partnerships reshaping the global auto industry as sharing costs becomes the name of the game.

The two companies signed a memorandum of understanding committing them to exploring collaboration across product design and technology, though neither side has announced specific programs or financial terms.

Initial jobless claims rose to 209,000 in the week ended May 16, according to data released by the Department of Labor on Thursday, coming in above the previous week’s revised tally of 212,000 first-time claims.

Economists had expected initial claims to be slightly higher at 210,000 for the week, according to consensus estimates compiled by Bloomberg. The four-week moving average of initial claims fell to 202,500 from 204,000 the week prior.

Continuing claims, which track the unemployed population still seeking work, rose to roughly 1.782 million in the week ended May 9 from the prior week’s revised count of roughly 1.776 million.

Economists had been looking for roughly 1.79 million continuing claims.