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A commercial for GLP-1 drugs during the Super Bowl LX broadcast on television screens at a bar in Los Angeles, California, US, on Sunday, Feb. 8, 2026.
Credit: Jill Connelly / Bloomberg via Getty Images

What You Need to Know

• Increasingly popular weight loss drugs are affecting the finances of people who take them in large ways and small.
• People who take GLP-1s significantly cut back on eating out and food delivery, and need to buy new clothes, according to surveys.
• The changes in lifestyle could result in new or changed expenses on top of the cost of the drugs, which can be up to $1,000 a month.

Weight-loss drugs are reshaping the spending habits of those who take them, influencing the broader economy in subtle yet noticeable ways.

New surveys shed light on how popular GLP-1 medications such as Ozempic and Monjauro change how people eat, drink, and shop, even after they stop taking them. A survey by Deutsche Bank found people taking the drugs went to restaurants and ordered out half as often as they did before, while spending slightly more at each visit. 

A separate analysis by market research firm Coresight found 72% of GLP-1 users had dropped at least one clothing size, suggesting an increased need to buy clothes. They are also contributing to the estimated $47 billion in apparel customers send back to online retailers each year because it doesn't fit.

What This Means For the Economy

The rise of GLP-1 medications could affect the economy by changing consumer preferences and expenditures, for instance, shifting spending away from restaurants and toward groceries.

"While we're all salivating at the prospect of where AI can go in the years ahead, perhaps the bigger leap in the near term is the technological miracle that is stopping us salivating at all," Jim Reid, global head of macro and thematic strategy at Deutsche Bank, wrote in a commentary. "Maybe GLP-1 is the real short-term general-purpose technology for a wider range of consumers, especially in the U.S."

The new data illuminate the less obvious financial effects of the medications, which nearly 12% of U.S. adults have used at some point, according to a poll last August by Rand. They could be even more popular now that the drugs are being released in the form of pills rather than injections.

These changes are minor compared to the cost of medications themselves, which can reach up to $1,000 a month, depending on the brand and whether they are covered by insurance. 

The drugs do save patients money in the long run by preventing costly chronic illnesses such as diabetes. However, the benefit does not outweigh the cost, according to an analysis last year by researchers at the University of Chicago. They found that covering GLP-1s for weight loss through Medicaid would cost about $66 billion but only save $18 billion by preventing other illnesses.

Economists and other researchers have been studying how the drugs could impact the economy far beyond healthcare. For example, they could save airlines as much as $580 million a year in fuel costs by making passengers lighter, according to an analysis by financial firm Jeffries, reported earlier this year.

Deutsche Bank’s survey of 550 people showed GLP-1 users changed what they bought, in addition to where they ate, buying less chocolate, candy, ice cream, and salty snacks and more fruits, vegetables, nuts, and protein shakes, for example.

The changes to dining out habits mostly stuck even after people quit the medication, according to the poll.

Gas prices are pushing up the costs of every day items for Americans, making them more pessimistic about the economy.
Credit: Alex Wroblewski / Bloomberg via Getty Images

Key Takeaways

• Consumer Sentiment fell to a fresh record low in May.
• The closure of the Strait of Hormuz has sent gasoline prices soaring toward record highs, amplifying longstanding discontent about consumer prices.
• Worryingly for the Federal Reserve, long-run inflation expectations shot up.

As pessimistic as the public is about the economy and their own household finances, a new poll is a reminder that things can always get worse.

The University of Michigan's Index of Consumer Sentiment fell in May to a fresh record low, the university said Friday. The reading of 44.8 on the index was the lowest since the survey began in 1952, and below the 48.2 forecasters had anticipated, according to a survey of economists by Dow Jones Newswires and The Wall Street Journal.

Sinking consumer confidence is likely a red flag about the impact of the Iran war on household finances and the economy. By cutting off traffic through the crucial Strait of Hormuz, the conflict has driven up prices for crude oil, gasoline, and other commodities.

Higher oil and gas prices have spilled over into other sectors, reigniting fears of another wave of inflation for consumers still reeling from pandemic-era price hikes that have never been reversed. The survey reflects a worsening of longstanding concerns among consumers about the cost of living.

What This Means For The Economy

The plunge of consumer sentiment to a fresh record low intensifies fears about the Iran war's energy crunch causing broader and longer-lasting economic damage than was anticipated at the outset of the conflict back in February.

"The cost of living continues to be a first-order concern," Joanna Hsu, director of the Surveys of Consumers program, said in a post accompanying the data. "Lower-income consumers and those without college degrees posted particularly strong sentiment declines; these groups are more sensitive to increases in the cost of gas and other essentials."

Gasoline, in particular, has been a sore spot for motorists entering the summer travel season. A gallon of regular gas averaged $4.55 nationwide heading into the Memorial Day weekend, according to AAA, up from $2.98 on Feb. 28 before the war began.

However, if the U.S. and Iran fail to reach a deal to open the strait this summer, forecasters anticipate fuel prices will have much farther to rise and could easily break record highs.

Friday's survey also raised a red flag for officials at the Federal Reserve tasked with using monetary policy to keep inflation at a 2% annual rate.

Long-run inflation expectations rose to 3.9% in May for 3.5% in April, according to the survey. Fed officials keep a close eye on inflation expectations because economists believe they can become self-fulfilling prophecies. Workers who brace for future high inflation may demand higher wages, and businesses may raise prices to afford those wages—potentially setting off a vicious cycle of accelerating inflation.

Ahead of the survey, Fed officials had already been contemplating raising the central bank's benchmark interest rate to counter inflation, and Friday's survey could give ammunition to those policymakers arguing a rate hike should be on the table.

Take-Two's 'GTA VI' game is expected to land in November.
Credit: Thomas Fuller / SOPA Images / LightRocket via Getty Images

Key Takeaways

• Take-Two Interactive offered an update that's welcome to gamers, confirming that "Grand Theft Auto VI" was still on track to launch in November.
• Its shares, however, fell Friday as investors digested a revenue outlook that was cooler than some expected.

The release date of Take-Two Interactive's flagship game is good news for video-game fans—but it's not helping the stock today.

Take-Two (TTWO) CEO Strauss Zelnick on Thursday reiterated a Nov. 19 launch date for "Grand Theft Auto VI," the latest installment in a culturally influential series that has been a big seller. Delays in the game's release have at times been an overhang for Take-Two's stock, so that news cheered investors, who lifted the shares premarket as they felt more certain that it would arrive in time for the holiday shopping season.

Why This Matters to Investors

Investors ultimately care most about what seems most likely to happen next—and information that offers insights along those lines. In today's case, a cooler-than-expected sales outlook carried more weight than stronger-than-expected earnings and good product news.

"We believe Fiscal 2027 will establish new record levels of operating performance driven by the November 19th launch of Grand Theft Auto VI, along with strong execution across our portfolio," Zelnick said in a statement that also included its full-fiscal-year results.

That premarket move, unfortunately, didn't hold, as investors turned their attention away from the GTA news. The stock was recently down more than 6%, with the shares now looking at double-digit percentage losses year-to-date.

The company turned in a smaller-than-expected fiscal fourth-quarter loss of 32 cents per share on $1.68 billion in revenue, but its outlook likely weighed on the shares. Take-Two directed investors toward a range of current-year revenue that topped out at $8.1 billion; Visible Alpha's consensus is for a bit more than $8.3 billion in sales.

Some bullish analysts said they viewed the outlook as too cautious. The guidance "came in below expectations, but appears overly conservative," Wedbush wrote. "We remain highly optimistic as Take-Two’s portfolio performs well across categories."

Alibaba Chair Jack Ma rings a bell on the floor of the New York Stock Exchange after the Chinese e-commerce giant's IPO in 2014.
Credit: Scott Eells/Bloomberg via Getty Images

Key Takeaways

• SpaceX is reportedly targeting a $75 billion initial public offering that could give the company a valuation of nearly $2 trillion.
• That would make the SpaceX offering three times the size of the previous leader for largest U.S. IPOs, Alibaba's in 2014.
• Past U.S. mega-IPOs have produced returns ranging from Visa's roughly 2,900% gain since 2008 to Rivian's 82% decline since 2021.

SpaceX's upcoming IPO could be the biggest new U.S. offering ever—many times over. But do big IPOs guarantee big returns? The numbers show that there’s no guarantee.

The Elon Musk–led rocket and satellite company—which on Wednesday submitted its S-1 filing with the Securities and Exchange Commission—is reportedly planning to raise $75 billion next month in a deal that could give the company a valuation of between $1.75 trillion and $2 trillion. An IPO of that size would easily triple the previous U.S. record, currently held by Alibaba's (BABA) $21.8 billion 2014 listing.

Why This Matters

Given recent rule changes, SpaceX is expected to be included in benchmarks like the S&P 500 and the Nasdaq 100 in the weeks following its IPO. Index funds tracking those benchmarks, including the most popular mutual funds and exchange-traded funds Americans own, would have to buy SpaceX shares. That makes SpaceX's returns a matter not just for Wall Street insiders but also for middle America.

Only eight companies have raised more than $10 billion in a U.S. IPO. Three—ENEL, Deutsche Telekom, and AT&T Wireless—have since been delisted or acquired, leaving the five above.

The list clusters in a few short years around the 2008 financial crisis. Visa went public in March 2008, days before Bear Stearns collapsed, raising $17.9 billion. General Motors (GM) relisted in November 2010 after its government-supported bankruptcy, raising $15.8 billion. Facebook, now Meta (META), followed in May 2012 at $16 billion. Alibaba, the record holder, raised $21.8 billion on the NYSE in September 2014. Rivian's $11.9 billion EV-mania debut in November 2021 rounds out the top five.

The expected raise for SpaceX would clear the top four combined.

The size of the capital raised at the open hasn't been a good predictor of how an IPO does.

Visa has produced the strongest return of any modern U.S. mega-IPO. From its split-adjusted offering price of $11 in March 2008, the stock now trades near $331, a gain of about 2,900% before dividends. Facebook went public at $38 in May 2012, spent more than a year below the offer price, and now trades above $600, up nearly 1,500%. Both opened into skepticism—Visa's bad timing before a market collapse, Facebook into doubts about its mobile transition—and both turned into winning bets for those who bought shares early.

The middle of the pack has been steady. General Motors, which re-listed at $33 in 2010, trades near $77, a price-only return of about 134%. Alibaba is up about 93% from its $68 debut, trading near $130 after a multiyear regulatory crackdown in Beijing wiped out earlier gains.

Rivian raised $11.9 billion at $78 per share in November 2021 and briefly hit an $86 billion market cap on its first trading day. Since then, the EV maker has fallen well short of the 200,000-vehicle annual production capacity it pitched to IPO investors for 2023, producing fewer than 50,000 vehicles in 2025. Now near $14, a decline of about 82% since its IPO, Rivian has posted roughly $22 billion in cumulative losses since 2022 as EV demand has softened amid higher interest rates and a pullback in government EV subsidies.

News of the day for May 22, 2026

The Dow Jones Industrial Average closed at a record high yesterday for the first time since February.
Credit: Michael M. Santiago / Getty Images

Stock futures are pointing to a slightly higher open ahead of the long holiday weekend; the Dow closed at its first record high in more than three months yesterday, while the S&P 500 is on pace to post gains for the 8th consecutive week; shares of Estée Lauder are rallying after the cosmetics maker dropped acquisition talks with a fellow makeup brand, Puig; Workday stock is rallying after the enterprise software maker reported results that topped Wall Street estimates; and Take-Two Interactive shares are climbing after the video game maker beat estimates and said "Grand Theft Auto VI" is still on track for its Nov. 19 release date. Here's what you need to know today.

Stock Futures Tick Higher Ahead of Holiday Weekend

Stock futures are gaining ground this morning as markets look to close out the week on a high note ahead of the three-day Memorial Day weekend. Futures tied to the Dow Jones Industrial Average were up 0.4% recently, while S&P 500 and Nasdaq futures added 0.2% The major indexes each rose yesterday, sending the Dow to a record closing high (more on that below). WTI crude oil futures, the U.S. benchmark, were up more than 1% at around $97.50 per barrel, but remain well below the highs of near $109 hit a few days ago. Gold futures were down slightly this morning at $4,520 an ounce, while bitcoin was little-changed at $77,400. The yield on the 10-year Treasury note ticked lower to 4.56%, after hitting a 16-month high of 4.67% on Tuesday. Bond markets will close early at 2 p.m. ET today ahead of the holiday weekend

Dow at Record High, S&P 500 Riding Win Streak

The major indexes are all on track to end the week higher than where they started it, with the S&P 500 in position to post gains for the 8th consecutive week. The tech-heavy Nasdaq Composite is on pace to post gains for the 7th time in the last eight weeks. Meanwhile, the Dow Jones Industrial Average on Thursday closed at a record high for the first time since Feb. 10. Coming into Friday's session, the Dow had risen 1.5% so far this week, outpacing the respective 0.5% and 0.3% gains of the S&P 500 and Nasdaq.

Estee Lauder Stock Jumps After Deal Talks Dropped

Shares of Estée Lauder Companies (EL) are rallying this morning after the cosmetics giant announced that it is no longer in talks to acquire a fellow makeup brand. The company and Puig, another cosmetics maker, said late Thursday that their talks over a potential acquisition, which started in late March, have ended without a deal. Shares of Estée Lauder were up 13% in recent premarket trading, after entering the day having lost about a quarter of their value since the start of the year.

Workday Stock Jumps on Solid Results, Raised Outlook

Workday (WDAY) shares are rallying after the enterprise software maker reported better-than-expected quarterly results and lifted its profitability forecast. Workday reported $2.54 billion in revenue along with adjusted earnings of $2.66 per share for the first quarter, each above the analyst consensus compiled by Visible Alpha. The company held its full-year outlook for subscription revenue steady, but lifted its adjusted operating margin guidance to 30.5% from 30% previously. Workday shares, which have fallen more than 40% so far this year, were up 7% ahead of the opening bell. Workday and a number of other software makers have seen their stocks battered by concerns that AI products will eat into their growth.

Take-Two Stock Rises on Confirmation of Grand Theft Auto VI Release Schedule

Shares of Take-Two Interactive (TTWO) are on the rise after the video game maker released results that topped analysts' estimates and confirmed that its latest blockbuster release, "Grand Theft Auto VI," is still on track for November. The company reported a smaller-than-expected fiscal fourth-quarter loss of 32 cents per share on $1.68 billion in revenue. CEO Strauss Zelnick said the Nov. 19 launch of "GTA VI" is expected to drive Take-Two's performance to record levels, after delays in the game's yearslong development have weighed on the stock in the past. Take-Two shares were up 3% in recent trading.

Salesforce shares have slumped more than 30% since the start of the year.
Credit: Gary Hershorn / Getty Images

Key Takeaways

• Salesforce is due to report earnings Wednesday afternoon, with traders anticipating the software maker's stock could swing up to 9% by the end of the week following the results.
• Sales and profits are expected to climb year-over-year, but some analysts are wary of the impact AI could have on Salesforce's business.

Salesforce is scheduled to report its latest quarterly earnings after the closing bell on Wednesday, with traders expecting a large move in the software maker's stock.

Salesforce (CRM) shares are seen swinging up to 9% in either direction by the end of the week following the results, according to recent options pricing. A move of that size from Thursday's close could see shares jump close to $192, recovering some of their recent losses. At the low end, shares could slip below $162, which would be their lowest level since early 2023.

The Slack parent company's stock has lost about a third of its value this year, as worries that AI products will disrupt the software industry have pressured shares of Salesforce and a number of others in the sector in the last several months.

Why This Matters to Investors

Salesforce's latest results could help boost sentiment around its stock and the broader software sector, if it can show strong demand for its own AI offerings, which could ease worries about disruption.

Bank of America analysts recently relaunched their coverage of Salesforce with an "underweight" rating and $160 price target, writing that they "expect a structural reset driven by AI transition," that could include slow customer growth, limited ability to upsell customers to more of its services, and an "underwhelming" path to monetizing AI.

Other analysts are more bullish. Deutsche Bank, which holds a "buy" rating and $255 target, forecasted a "seasonally slow but steady start" to the year, and suggested that AI worries "underappreciate the opportunity for software companies to adapt to new paradigms, in addition to the timeline over which any disruption might occur."

Salesforce is expected to report $11.05 billion in revenue, up 12% year-over-year, along with adjusted earnings of $3.11 per share, up from $2.58 the same time a year ago.

Analysts are largely bullish on Salesforce, with 14 of the 20 analysts with current ratings tracked by Visible Alpha calling the stock a "buy," compared to five neutral ratings and just one "sell" rating. Their average price target of $262 would imply close to 50% upside that would bring Salesforce shares nearly back to where they started the year.

Walmart executives on Thursday said they've increased the number of discounted products in their stores by 20% in the past year.
Credit: Jeffrey Greenberg / Universal Images Group via Getty Images

Key Takeaways

• Grocers like Kroger and Walmart expect to cut prices this year in a bid to attract shoppers feeling the pinch of soaring gasoline prices.
• Walmart has increased the number of discounted items in its stores by 20% in the past year, and executives said on Thursday that extending those price cuts was a top priority for the retailer.

Shoppers are feeling the pinch at the pump. Grocers hope to offer some relief in the produce aisle. 

Kroger (KR) plans on testing price cuts on thousands of items in a bid to take share from low-cost rivals, according to a Bloomberg interview with CEO Greg Foran. “The reality is, the basket has to come down. And not everyone’s basket is the same,” said Foran. “It needs to be across thousands of products.”

U.S. retailers have been grappling with increasingly thrifty consumers ever since inflation soared to multi-decade highs in 2022. The pressure has been especially intense on food establishments like grocers and restaurants, whose prices consumers encounter on a near-daily basis. Diners have taken to social media to vent about fast-food prices, while soaring egg prices became a flashpoint in the 2024 election.

Why This Is Important

Because they're essential expenses that the majority of Americans encounter on a regular basis, gas and groceries are two categories where shoppers are especially sensitive to prices. Grocers are hoping they can boost their standing with shoppers by lowering food prices to offset soaring costs at the gas pump.

Restaurants responded by flooding the market with value meals, and grocers are slashing prices. “We're continuing to invest in prices, extending the rollbacks we started in the second half of last year,” John Furner, CEO of Walmart (WMT), America's largest grocer, said on an earnings call Thursday. The company has cut prices on 7,200 items, a more than 20% increase from last year, according to CFO John David Rainey. 

Soaring fuel costs have amplified the pressure to cut prices. Gas prices have risen sharply this year, driven higher by the war in Iran and the near-total closure of the Strait of Hormuz. The average price of gasoline in the U.S. was $4.56 a gallon on Thursday, up more than 50% since late February.

Higher gas prices are weighing on shoppers, hitting them at the pump but also in the price of goods that must be shipped to the point of sale. Consumer confidence is at an all-time low, and retail executives are starting to see customers change their behavior. The average fuel purchase at Walmart gas stations recently dropped below 10 gallons for the first time since 2022, according to Rainey.

“That's an indication of stress,” he said.

Grocers could be competing to undercut each other's prices for some time. When asked what Walmart would do with any tariff refunds, Rainey said the company would "try to prioritize price investment” considering the pressure consumers face. “We think the single best return that we can have on a dollar of capital right now is to invest in the customer.”

Granted, the Middle East conflict could make it difficult to lower grocery prices. Before the war, the Strait of Hormuz accounted for about a third of seaborne fertilizer trade. A global fertilizer shortage is likely to drive up costs across the food supply chain, forcing retailers to pay more to restock their shelves.

SpaceX's IPO filing appears to have something for Elon Musk fans and critics alike.
Credit: Photo by BRENDAN SMIALOWSKI / AFP via Getty Images

Key Takeaways

• SpaceX's IPO filing drop is proving to be a double-edged sword, building excitement for its June debut but also putting the company's financials on display.
• A look inside the books reveals questions to be asked about the company's fundamentals—and about whether the Elon Musk-led story is enough to drive demand for the stock.

Now that we know a bit more about the SpaceX IPO, the question is inevitable: Should you invest in it?

The initial public offering of SpaceX, expected in June, could be be the biggest in history, and its business—rockets, satellites, and artificial intelligence—has characterists the market has been rewarding lately. At what price "SPCX" shares will sell when they land on the Nasdaq remains an outstanding question, but investors are already debating whether they can produce the kind of long-term returns the current hype implies. After investors got a glimpse of the company's financials when its S-1 filing dropped, the reality that the company burns as much money as it collects set in, though some investors think the stock will zoom anyway.

The biggest reason could be a simple one: The CEO is Elon Musk, whose fanbase of investors—both lay and professional—believe he can accomplish the seemingly impossible. That stands to make SpaceX a hot ticket. "The story matters more than the fundamentals these days," one user of Reddit's WallStreetBets forum said Thursday.

WHY THIS MATTERS TO YOU

Whether investors want to buy SpaceX or not, they may end up owning it anyway: The stock is expected to be fast-tracked into major indexes including the S&P 500 and Nasdaq 100.

The story as Musk tells it in the company's IPO paperwork: "It's about believing in the future and thinking that the future will be better than the past. And I can't think of anything more exciting than going out there and being among the stars."

Indeed, the company is building reusable rockets, setting up satellite internet, developing AI capabilities, and running X, formerly called Twitter. Its future markets, which it says include "space tourism," "in-orbit manufacturing," and "asteroid mining," according to its filing, imply an addressable market of $28.5 trillion. (SpaceX may even appeal to bitcoiners, since it has roughly $1 billion worth of the cryptocurrency on its balance sheet.)

Some investors have already shown enthusiasm for some of the themes SpaceX embodies. It's likely that interest in SpaceX has lately lifted space-focused ETFs and pure-play space stocks, of which there are many. That may force a decision in some minds about whether it's better to look for investments less-diversified than Musk's company: Some analysts—namely Wedbush's Dan Ives—think Tesla (TSLA) could be part of the mix in 2027.

"Musk wants to own and control more of the AI ecosystem and step by step the holy grail could be combining SpaceX and Tesla in some way to give the connected tissue between both disruptive tech stalwarts looking to lead the AI Revolution," Ives wrote in a note yesterday. Of course, that could also draw investors toward SpaceX stock, especially as they search for a new stock-market standard bearer among a series of expected mega IPOs later this year.

Still, some investors are poking around the numbers as well as the big picture. Bespoke Investment Group's George Pearkes in a series of social media posts yesterday said "this isn't as bad as I expected" of the company's fundamentals, save for the "interest expense" on its debt, which is almost $30 billion as of the end of the first quarter. SpaceX's space and connectivity business looks "fine?" he said, but he also observed that the company's revenue growth in the first quarter was "half of 2025's pace" while research and development costs more than doubled year-over-year.

Prices at the pump have soared since the start of the Iran war in late February.
Credit: David Paul Morris / Bloomberg via Getty Images

Key Takeaways

• The national average for gasoline could jump to more than $5 this summer, reaching its highest price on record, as the Iran war-related oil crunch drags on.
• After adjusting for inflation, however, fuel prices are actually much easier for household budgets to absorb than during the energy crisis of 2008.

Gasoline may reach a record high this summer, but that doesn't mean it's taking the biggest bite out of your budget that it ever has.

If the Iran war isn't settled by mid-summer and the Strait of Hormuz stays closed, the resulting oil shock could send the national average price for a gallon of unleaded gas above $5.03, according to Patrick DeHaan, head of petroleum analysis at GasBuddy. That would nudge the price above the record set in 2022, when the Ukraine conflict sent prices through the roof. The current national average stands at $4.55, according to GasBuddy.

However, if you adjust for inflation, fuel prices are actually much easier for household budgets today to absorb than during the energy crisis of 2008, based on data from the Bureau of Labor Statistics, which tracks inflation by measuring prices for thousands of things people buy.

What This Means For The Economy

Inflation adjustment sheds light on why the economy has been more resilient against high gas prices today than it was in the early 2000s, when soaring fuel costs contributed to the onset of the Great Recession.

Making gasoline prices proportional to the resulting Consumer Price Index shows how expensive gas is relative to everything else, and to incomes, which have risen faster than inflation over the decades. This gives some idea of how much of your buying power is being taken up by gasoline.

Relative to inflation, gasoline was its most expensive ever in June 2008. The 2022 spike in prices pushed the average to a nominal record high, but still well-below the 2008 peak after adjusting for inflation.

(The cause of today's oil price surge is obvious, while the one in 2008 is a bit murkier and is debated by economists, and possibly was due to a speculative bubble in financial markets.)

Still, the rising cost of fuel is a major headache for household budgets as well as the broader economy, and is part of a widespread increase of the cost of living since the pandemic that has plunged consumer sentiment about the economy to its lowest in at least 74 years.

The federal government is reportedly making investments in a group of companies in the quantum computing sector.
Credit: Angela Weiss / AFP / Getty Images

Key Takeaways

• A number of quantum computing stocks rallied Thursday after several companies announced award letters of intent from the federal government.
• IBM and GlobalFoundries are set to receive some of the largest funds in a $2 billion round of investments, along with several quantum computing startups.

The federal government is moving to expand its investment portfolio with stakes in a number of quantum computing firms, sending their shares higher Thursday.

Shares of IBM surged 7% in recent trading, while D-Wave Quantum (QBTS) and Rigetti Computing (RGTI) each popped 26% on expectations of awards from the Commerce Department, which could hand out a total of $2 billion in grants across the sector, The Wall Street Journal reported Thursday. The Commerce Department did not respond to an Investopedia request for information in time for publication.

Of that $2 billion, about half is set to go to International Business Machines (IBM), which said it received a letter of intent for a $1 billion deal, and $375 million is earmarked for chipmaker GlobalFoundries (GFS), with $100 million allocated to several public and private quantum computing firms. GlobalFoundries shares were up 10% recently.

Other stocks related to quantum computing also gained, on what was a down day for broader markets. (Read Investopedia's full coverage of today's trading here.)

Why This Matters to Investors

The backing from the federal government could serve as an encouraging signal for investors betting on developments in the quantum computing industry.

The funds are coming from the CHIPS and Science Act, which was passed under the Biden administration and was meant to boost semiconductor manufacturing in the U.S. Under the deals announced Thursday, the government will get equity stakes in the companies.

Among the private companies receiving the grants are Atom Computing, PsiQuantum and Quantinuum, which each announced their letters of intent from the Commerce Department Thursday morning. The letters come as the Trump administration is preparing an executive order focused on supporting the quantum computing industry, per The Wall Street Journal.

The new investments join a growing portfolio managed by the Trump administration, which has already taken a stake in Intel (INTC), as well as several mining companies. The administration also reportedly considered an investment to help save Spirit Airlines from ceasing operations last month.