This report is from today's CNBC Daily Open, our international markets newsletter. CNBC Daily Open brings investors up to speed on everything they need to know, no matter where they are. Like what you see? You can subscribe here.

What you need to know today

S&P 500 slips from record high
The S&P 500 briefly passed the 5,500 mark for the first time before ending the session lower. The Nasdaq Composite dipped as Nvidia ran out of steam. The Dow Jones Industrial Average bucked the trend, recording its best day since May. The yield on the 10-year Treasury rose. U.S. oil prices traded above $82 a barrel and are on track for their second straight week of gains.

HIV shot
Gilead Sciences' shares surged 7% after the company announced its experimental twice-yearly HIV prevention medicine demonstrated 100% effectiveness in a late-stage trial. None of the nearly 2,000 women who got the lenacapavir shot in the trial had contracted HIV, an interim analysis showed. The independent data monitoring committee has recommended Gilead to offer the treatment to all the participants in the study.

Nvidia trumps major EU markets
Nvidia's meteoric rise has elevated it above the stock market value of some of the world's largest economies. On Tuesday, Nvidia's market capitalization surpassed $3.3 trillion, overtaking Microsoft as the largest U.S. stock. Remarkably, its market cap now exceeds the total value of the stock markets in Germany, France, and the United Kingdom, measured individually in U.S. dollars.

Open AI challenger
Anthropic, a leading AI competitor to OpenAI, unveiled Claude 3.5 Sonnet, its most advanced AI model to date. Backed by tech giants Google, Salesforce and Amazon, Anthropic closed five funding deals totaling about $7.3 billion in the past year. Claude 3.5 Sonnet "shows marked improvement in grasping nuance, humor, and complex instructions, and is exceptional at writing high-quality content with a natural, relatable tone," the company said in a blog post.

Trump Media shares sinks
Former President Donald Trump's stake in Trump Media has plummeted by over $2 billion, falling from $5.6 billion at the beginning of the month. The company, which owns Truth Social, saw its shares drop more than 14% on Thursday. Trump Media's decline follows the conviction of Trump, the presumptive Republican presidential nominee, on 34 felony counts of falsifying business records by a New York jury.

 [PRO] Nasdaq picks

The Nasdaq 100 has surged 19% this year, outpacing the S&P 500's 15% gain. AI hype has fueled record highs, with Broadcom, Apple, and Nvidia driving the rally. CNBC Pro's stock screener identifies Nasdaq 100 stocks analysts predict will soar in the next 12 months.

The bottom line

Before Europe's debt crisis, political motives often overshadowed economic prudence. The European Union had established a 3% budget deficit target in 1997, but in its rush to expand, Greece was admitted to the Eurozone in 2001. The rest is history. After relaxing the deficit target during the pandemic, the EU's executive arm is now warning countries about excessive spending once again.

France is among the seven countries breaching the deficit limit, potentially hindering spending plans of Marine Le Pen's party. Le Pen, leading in polls, has pledged to cut VAT on essentials and lower the pension age. France's budget gap is expected to narrow to 5.3% this year from 5.5% in 2023. 

The debate mirrors concerns in the U.S., where the deficit is projected to rise to $1.92 trillion this year, or 7% of GDP, according to the Congressional Budget Office, the independent fiscal watchdog for lawmakers. This marks a 27% increase over February's forecast.

The additional $408 billion in spending is largely due to legislation allocating $95 billion to Ukraine, Israel, and the Indo-Pacific region, along with the Biden administration's spending on student loan relief and Medicaid. By the end of 2034, public debt is expected to total $50.7 trillion, or 122% of GDP, compared to February's forecast of $48.3 trillion, or 116% of GDP. 

Currently, there is little indication that Republicans or Democrats will curtail spending plans or tax giveaways.  

Roger Altman, Evercore founder, told 'Squawk Box,' "The idea of a 7% deficit in an economy this strong is dangerous... It's trite to say it, but it is perhaps unsustainable. If it's not proactively fixed, market forces ultimately will force it to be fixed, and that will be ugly."

"Markets seem to ignore for a very long time it until they don't ... At some point, the markets are going to wake up and dislike this. It's going to dramatically affect Treasury financing."

As for the markets, they're showing signs of fatigue. Nvidia fell from an all-time high, dragging down the S&P 500 and Nasdaq. Interestingly, JP Morgan believes the bull run has been driven by less short selling in major averages. 

"One support for the U.S. equity market over the past year emanated from a decline in the short interest on the two biggest equity ETFs," the SPDR S&P 500 ETF Trust and the Invesco QQQ Trust that tracks the performance of the Nasdaq-100 index, strategists led by Nikolaos Panigirtzoglou wrote. "This short interest has been declining in a rather steady manner since the second quarter of 2023 making successive record lows," they said. 

With markets feeling extended, short sellers could make a return.

— CNBC's Brian Evans, Kevin Breuninger, Hayden Field, Jesse Pound, Angelica Peebles, Scott Schnipper and  Brian Evans contributed to this report.