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Futures muted, OpenAI and Reddit strike deal – what’s moving markets

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Investing.com — U.S. stock futures are muted on Friday, with Dow futures in particular treading water following a momentous session for the blue-chip index that saw it briefly touch an intraday record high. Reddit shares spike in extended hours trading after the social media group struck a deal with OpenAI that will grant the Microsoft-backed artificial intelligence start-up access to its platform.

1. Futures muted

U.S. stock futures searched for direction on Friday, after equities on Wall Street slipped in the previous session as a rally sparked by mild inflation data earlier in the week lost some steam.

By 03:31 ET (07:31 GMT), the Dow futures contract, S&P 500 futures and Nasdaq 100 futures were mostly unchanged.

The main averages dropped on Thursday, with the 30-stock Dow Jones Industrial paring back gains that pushed it up to an intraday of 40,000 for the first time. Both the benchmark S&P 500 and the tech-heavy Nasdaq Composite also finished trading in the red.

On Wednesday, the indexes had posted all-time high closing levels following data showing a smaller-than-anticipated increase in consumer prices in April, which powered hopes that the Federal Reserve will roll out as many as two interest rate cuts later this year.

2. Reddit shares spike on OpenAI deal

OpenAI has announced a new partnership with Reddit that will allow it to use content from the social media platform for its ChatGPT artificial intelligence chatbot.

Under the agreement, OpenAI will gain access to content on Reddit’s website, while Reddit will incorporate new AI features for users and mods, the companies said on Thursday. The two will also collaborate on advertising.

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Reddit’s shares surged 11.5% in aftermarket trade following the announcement.

Thursday’s announcement comes as OpenAI is moving to strike deals with media groups in a bid to help train its powerful AI model with data from sources that are widely viewed as reliable. OpenAI, which is backed by tech giant Microsoft (NASDAQ:MSFT), is also facing legal action from some publishers who have claimed that content generated by the firm infringes on their copyrights.

3. Boeing shareholders to vote on outgoing CEO’s board status

Boeing (NYSE:BA) shareholders are set to vote on whether outgoing Chief Executive David Calhoun will retain his seat on the board of the embattled planemaker.

Executives at the company have already begun a search to find a replacement for Calhoun, who has previously said that he plans to retire at the end of the year. Investors have called for someone outside of Boeing to come in as Calhoun’s successor, arguing that the firm’s current leadership structure lacks credibility.

Boeing’s reputation for safety was dented by a dangerous mid-air breach on one of its 737 Max jets earlier this year. Shares in the group have shed more than a fourth of their value in 2024.

Ahead of a virtual annual general meeting on Friday, Reuters has reported that proxy advisor Glass Lewis is calling on stakeholders to choose not to bring Calhoun back to the board, citing Boeing’s safety record during his tenure.

4. Chinese industrial production grows in April

Chinese industrial production grew more than expected in April, indicating that a rebound in the country’s massive manufacturing sector remained on track.

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But signs of weak consumption in the country persisted, with growth in retail sales largely missing expectations last month.

Industrial production grew 6.7% year-on-year in April, data from the National Bureau of Statistics showed on Friday. The reading was faster than expectations of 5.5%, and accelerated from a 4.5% rise seen in March.

China’s manufacturing sector has received ongoing support from Beijing, including monetary stimulus aimed at stoking a recovery in the world’s second largest economy.

5. Oil on pace for weekly gains

Crude prices rose Friday, putting them on course for weekly gains fueled by signs of improving demand and slowing inflation in the United States, the largest consumer of crude in the world.

By 03:30 ET, the U.S. crude futures traded 0.3% higher at $79.50 per barrel, while the Brent contract climbed 0.5% to $83.66 a barrel. Both contracts are on track to post weekly gains of over 1%.

Oil markets have been boosted by the softer-than-expected inflation release, which has increased the prospect of lower rates, potentially lifting future global economic activity and thus oil demand.

A drop in U.S. oil inventories also bolstered hopes that demand was improving, especially as the travel-heavy summer season approaches.

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