Wall Street is open… and SpaceX has overtaken Amazon’s market capitalisation.

The rockets-to-satellites-to-AI company’s shares have risen by 8% at the start of trading in New York, as investors digests its $60bn deal to buy the maker of coding app Cursor (see earlier post).

This lifts SpaceX’s market capitalisation to over $2.7tn, Bloomberg TV have rapidly calculated, ahead of Amazon with $2.65tn.

SpaceX’s shares are now changing hands at $207.83, having floated at $135 each on Friday.

New construction of private housing in the US has slumped to its lowest level in six years, when the Covid-19 pandemic was hitting America’s economy.

Privately-owned housing starts in May fell by 15.4% in May to a seasonally adjusted annual rate of 1,177,000, the lowest since May 2020.

This may be a sign that the jump in mortgage rates, and the rise in raw material costs, since the Iran was began is hurting the US housing market.

The US Census Bureau also reported that US single-family homebuilding fell to an eight-month low, while starts for housing projects ⁠with 5 units or more, a very volatile segment, plunged 41.6%.

The European Parliament has given its final approval to legislation implementing last July’s tariff agreement with Donald Trump.

Ahead of a threat to increase tariffs if the deal was not sanctioned by 4 July, the MEPs agreed to approve the deal but with two main provisons.

The first is a “sunset clause” which will see the deal expire on 31 December 2029 unless otherwise renewed.

It will also set what it described as “clear conditions” on tariff reductions on products containing some steel and aluminium, tariffs that Trump has imposed under national security laws rather than the tariff regime he institution on “liberation day” last April.

Under the deal the US applies 15% on most EU exports while in turn, the EU has cut to zero import duties on some US goods and some agricultural product.

The deal is now expected to be formally adopted by EU leaders who meet in Brussels on Thursday.

The benchmark oil price has just slipped below $80 a barrel for the first time since the early days of the Iran war, as traders remain confident about the US-Iran peace deal.

Brent crude just dipped as low as $79.96 a barrel, its lowest since Tuesday 3 March – in the first week after the US-Israel attacks on Iran began.

This means that Brent has fallen by $15 a barrel since last Thursday, before optimism began building that Washington and Tehran might reach an agreement.

Oil added to its earlier losses after Iran state media reported that Iranian oil tankers have resumed shipping following the deal with Washington.

A state television reporter explained:

“Three Iranian oil tankers are currently sailing in the northern Indian Ocean, and two others carrying essential goods and livestock feed are en route and sailing towards southern ports.”

The reporter added that “the operation to lift the naval blockade has been implemented”, which suggests that the US naval blockade has been eased.

As reported earlier, European allies at the G7 summit don’t appear to share Donald Trump’s optimism that the strait of Hormuz will reopen by Friday.

In the restaurant sector, Yum Brands is selling Pizza Hut in a $2.7bn deal, after strugging to compete with rivals in the pizza business.

Private equity firm LongRange Capital has agreed to buy Pizza Hut, excluding its operations in Mainland China, after “a comprehensive review of strategic options” that began last November.

Pizza HutChina will be acquired by Yum China Holdings.

The deal will allow Yum to focus on its other three brands – KFC, Taco Bell, and Tabit Burger & Grill.

Chris Turner, chief executive officer at Yum! Brands, explains:

“These transactions enable Yum! to be a more focused company that continues to leverage scale, technology and talent to accelerate our raising the B.A.R. priorities and deliver sustained value for our stakeholders.

“Under LongRange and Yum China, Pizza Hut will be well positioned for future growth with ownership that brings deep expertise in the restaurant industry. Pizza Hut is one of the most iconic restaurant brands in the world, and we are proud of the important role it has played in Yum!’s history. Pizza Hut was built by the passion and dedication of our team members, employees and franchisees, and we’re excited for the next chapter.”

Yum began reviewing Pizza Hut’s future after it reported several quarters of declining same-store sales in the US, facing competition from Domino’s, and from third-party delivery apps.

SpaceX has just revealed it is acquiring code-generation startup Cursor for $60bn in stock, just days after Elon Musk’s company floated on the US stock market.

In an SEC filing, SpaceX says it has entered into an Agreement and Plan of Merger with Anysphere, the company behind Cursor, under which Cursor will become a wholly owned subsidiary.

The merger is expected to close during the third quarter of 2026.

Cursor uses artificial intelligence to automate coding. The deal could give xAI, the Grok chatbot maker that SpaceX merged with in February, a stronger foothold in the AI coding market where it has so far lagged rivals. It also provides Cursor with more computing capacity to develop AI models.

Back in April, SpaceX secured an option to either acquire Cursor for $60bn, or pay $10bn for their new partnership.

Cursor shareholders will receive shares in SpaceX, based on the average closing price over the seven consecutive trading days before the Merger closes.

SpaceX’s shares are set to jump by 9% when trading begins on Wall Street later today, having jumped around 19% on Friday – the day they floated – and another 19% yesterday.

In an encouraging development, two Iran-linked tankers are sailing eastward through the Strait of Hormuz.

The Musik is in the strait, while the Argo Maris has already passed through and is in the Gulf of Oman, but is still within the US blockade line that runs from the easternmost tip of Oman to the Iran-Pakistan border.

Bloomberg reports that satellite imagery shows Musik loaded a cargo at Iran’s Bandar Imam Khomeini port deep in the Persian Gulf on June 10. Argo Maris was seen departing the Iranian port of Bandar Abbas in late May, according to shiptracking firm Kpler.

They add:

It’s unclear if they will attempt ship-to-ship transfers at points such as Sohar or Fujairah, wait near the US blockade line, or attempt to cross it.

Both vesesels appear on a list of officially blacklisted tankers for transporting Iranian oil.

Over at the G7 summit in Évian-les-Bains, European allies don’t appear to share Donald Trump’s optimism that the strait of Hormuz will reopen by Friday.

One G7 official has told Bloomberg there are serious difficulties in finding a common position among the group about how to deal with the situation in Iran.

They add:

One senior US official said traffic in the waterway would ramp up over time, and it could take as many as two weeks for shipping to significantly increase — and even longer for it to return to the levels seen before the US and Israel attacked Iran in February.

There are mines in the strait that still need to be cleared and shippers have different risk tolerances about navigating Hormuz, the official said.

More here.

The oil price has dropped to its lowest level in almost 15 weeks, despite uncertainty over how quickly the strait of Hormuz will reopen.

Brent crude has fallen by almost 2.5% today to just over $81 a barrel, adding to Monday’s 4.75% drop. That’s its lowest level since 4 March, the first week of the Iran war.

However, it’s still some way above Brent’s pre-war level of $72.48 a barrel.

Oil traders are calculating that the reopening of the strait of Hormuz will lead to a rise in oil supplies from the Middle East, after Donald Trump said the vital waterway will reopen once the US and Iran have signed an initial memorandum of understanding.

Economists are warning, though, that it will take time for traffic through the strait to return to normal, as some production facilities need to be reopened, or repaired, and some oil and gas tankers are in the wrong places.

The head of the world’s biggest tanker operator, Mitsui OSK Lines, has told the Financial Times that ahipowners will not resume transit through the Strait of Hormuz for weeks until they are confident that the US-Iran deal is “material”.

Kathleen Brooks, research director at XTB, explains:

Bosses of the world’s biggest shipping companies want to see more than just an agreement in place, mines need to be swept, and all hostilities must end, before tankers with hundreds of millions of dollars’ worth of cargo will be able to traverse the Strait without fear of a flare up in tensions that could close the Strait mid-voyage.

Thus, even if a deal is signed to end the US/Iran war, the situation is not without its challenges. Brent crude remains above $80 per barrel, and it is unlikely to fall below this level until we start to see cargo ships successfully get through the Strait.

Nearly 40 years after founding flexible office space company International Workplace Group, Mark Dixon is stepping aside as chief executive.

Dixon, who has an estimated wealth of $1.3bn (£1bn), will shift to become executive chair, with IWG’s board keen to keep his “unrivalled industry knowledge, experience and long-term strategic perspective” and allow him to advise his succcessor, Christian Schmitz.

Having left school at 16, Dixon had already made a small fortune from selling a business venture manufacturing bread buns for hotdog sellers, before launching Regus (as IWG was previously known) after strugging to find a “small, quality office” to rent for his own business in Brussels in 1989.

He told the Guardian last year:

“We can see more and more companies converting to a ­simple notion…which is: ‘I don’t need a big head office in one place … I need hubs, and I just use space on a platform where people need it.’”

Chancellor Rachel Reeves has said on Tuesday she hoped to get to the next budget without raising taxes.

Reeves argued that the government now had enough fiscal headroom to withstand economic shocks, following last November’s budget.

She told a conference organised by the Financial Times in London:

“We made a decision to significantly increase the headroom against our fiscal rules.

“I believe that that was the right decision.”

Reeves’s allies has been lobbying for her to remain as chancellor even if Keir Starmer is replaced by Andy Burnham, should the Manchester mayor win Thursday’s Makerfield by-election.

Thomas Pugh, chief economist at audit, tax and consulting firm RSM UK, says the economy risks another messy leadership battle.

Pugh says:

The Labour Party would still have an incentive to install a new leader before its annual conference in late September.

A leadership contest focused on tax rises or ideas for borrowing will likely sap business and consumer confidence and spook financial markets, dragging on growth in a similar way to the previous two budgets effectively stalled the economy.

The Bank of Japan’s deputy governor, Shinichi Uchida, has welcomed the US-Iran peace deal.

Speaking at a press conference following today’s rate hike, Uchida said the deal was a “welcome move”, explaining:

“Compared with our previous meeting in April, the U.S. and Iran have signed a memorandum. That is a welcome move. Having said that, there is uncertainty on the pace of improvement in distribution (of oil).”

Uchida also pointed to inflationary risks, saying:

Compared with the previous meeting, the risk of a sharp deterioration in the economy has diminished. On the other hand, price rises are broadening, and there is a risk that underlying inflation may deviate from our target.”

“With underlying inflation approaching 2%, it’s important to ensure we achieve our target stably.”

Uchida is standing in for BoJ governor Kazuo Ueda, who was hospitalized last week for treatment of a liver cyst infection.

The BoJ’s interest rate hike didn’t prevent Japan’s Nikkei share index from hitting a fresh record high.

The Nikkei soared through the 70,000-point mark for the first time ever, and has ended the day at a new closing high of 69,404.5 points.

Other Asia-Pacific markets have also continued to rise today, amid ongoing optimism over the US-Iran peace deal.

Thames Water has moved a step closer to nationalisation after government ministers reportedly formally objected to the £10bn rescue deal proposed by its creditors.

According to The Times this morning, environment secretary Emma Reynolds has written to water regulator Ofwat this week to raise concerns about the plan for the struggling, indebted utility giant.

They explain:

Reynolds is understood to be concerned that the creditors’ offer for Thames Water is “weak”, not least after “15 years of mismanagement and failure”.

Those who support placing Thames into special administration argue that this would give the company a fresh start by forcing existing investors to write off losses and allow the company to be sold without its existing debt pile.

Under the proposed rescue deal, Thames Water’s creditors would inject £3.35bn of fresh equity, and write off a third of their debt.

They are also seeking up to 15 years’ leniency from river pollution rules, arguing that this will make it easier to upgrade the trouble company’s water network.

Reynolds’s intervention comes just days after Manchester mayor Andy Burnham told the Guardian that Thames Water should be nationalised, just days before the Makerfield by-election which – should be win – could lead to a leadership challenge against Keir Starmer.

If the government were to approve the deal with creditors, then Thames Water – which currently has aroun £20bn of debt – would be part-controlled by the billionaire Trump donor and hedge funder Paul Singer.

Good morning, and welcome to our rolling coverage of business, the financial markets and the world economy.

The inflationary consequences of the US-Iran war continue to ripple across the global economy, even though the US and Iran have agreed a memorandum of understanding (MOU) to end their conflict.

With price pressures rising, the Bank of Japan has raised interest rates to a 31-year high today, becoming the second G7 bank – after the European Central Bank – to hike borrowing costs since the Iran war began.

Policymakers in Tokyo raised the BoJ’s short-term policy rate to 1% from 0.75%, taking borrowing costs to levels last seen in 1995.

The BoJ said it was taking action because companies were passing on rising oil costs to each other at a “relatively fast pace.” That could lead to a rise in consumer prices across a wide range of items, it said.

It acted despite yesterday’s 4.75% drop in the oil price.

Encouragingly, the BoJ also said the risk of Japan’s economy deteriorating sharply from the Middle East conflict has diminished. It cited the government’s relief package to help households facing high fuel costs.

The agenda

• 9.45am BST: Treasury select committee hearing on the Office for Budget Responsibility

• 10am BST: ZEW economic sentiment index

• 1.30pm BST: US housing starts and business permits data