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Iran's New Supreme Leader Just Blew Up the Peace Talks,
and the market hasn't fully priced it yet. Mojtaba Khamenei issued a written statement Thursday vowing to defend Iran's nuclear and missile technologies "like their maritime, land, and air borders" — and warned that foreigners have no place in the Persian Gulf "except at the bottom of its waters." Trump's demand for full denuclearization is non-negotiable. Iran's position is equally non-negotiable. Brent hit $126 on Thursday before pulling back. Peace by June 1 is now a fantasy.
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Apple Posts Its Best Quarter in History and the Ternus Era Begins,
with $111.2 billion in revenue — up 17% — and iPhone revenue hitting $57 billion, up 22% for the second consecutive quarter. Cook called it the best March quarter in the company's history. Incoming CEO John Ternus made his first public comments, calling this "the most exciting time in my 25-year career at Apple to be building products and services." Stock is up 4%. I have been following Apple since Steve Jobs, and I go way back. The transition is smoother than the market feared. Buy (AAPL) on dips.
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Eli Lilly Posts the Most Impressive Pharmaceutical Quarter in Years,
with Q1 revenue of $19.8 billion — up 56% — crushing the $17.6 billion estimate. Mounjaro sales hit $8.66 billion, up 125%. Zepbound US revenue rose 80% to $4.16 billion. EPS came in at $8.55 against a $7.06 estimate, a 21% beat. The company raised full-year revenue guidance by $2 billion to $82–85 billion. I have been watching drug companies since the Salk vaccine. This is what a generational pharmaceutical shift looks like in the numbers.
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Exxon and Chevron Both Beat Estimates on the Same Morning,
and this is what the back half of 2026 is going to look like. Exxon beat on revenue at $85.14 billion versus an $82.18 billion estimate, and delivered a one-year total shareholder return of 42%. Chevron's adjusted EPS of $1.41 was its biggest beat since October 2020 against a 95-cent estimate. Profits were down year-over-year — that's the Q1 average oil price story, not the forward story. With Brent above $100 and the Hormuz closed, Q2 and Q3 are a completely different conversation. I have been in this oil trade since February. Good thing I never left. Buy (XOM) and (CVX) on dips.
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The S&P 500 Just Had Its Best April Since 2020 — Now Comes the Hard Part,
with the index up over 9% for the month and closing above 7,200 for the first time ever. The Nasdaq surged 15%. April rewarded the brave. But today is May 1, and I have been trading this market for 50 years. "Sell in May and go away" is not just a bumper sticker — it is the historically worst six months of the year. The war is unresolved. The Fed is on hold. Kevin Warsh takes the chair in two weeks with three hawkish dissenters already on the board. Enjoy the record. Then get defensive.
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Personal Core Expenditures Price Index Leaps,
which excludes food and energy, accelerated a seasonally adjusted 0.3% for the month. That pushes the 12-month inflation rate to 3.2%, a 29-month high, the Commerce Department reported Thursday. Core inflation hit its highest level since November 2023. Consumers faced escalating prices in March as the Iran war sent oil soaring and created a new level of challenges for the Federal Reserve, according to a batch of reports Thursday that showed economic growth slower than expected and a generational low in layoffs.
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US Q1 GDP Growth Shrinks to 2% Annualized,
bolstered by a massive AI-driven upswing in business investment. Consumer spending increased at a 1.6% rate, driven by demand for services including healthcare and financial services, while business outlays on equipment and structures advanced 10.4%, the fastest pace in almost three years. The geopolitical situation risks tempering growth should inflation-weary consumers become more guarded, with inflationary pressures accelerating sharply in March as the war spurred a surge in gasoline prices.
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Alphabet Earnings Rock,
with quarterly revenues up $109.9 billion, much more than expected. The company also updated its 2026 capital expenditure guidance range of $180 billion to $190 billion, up from its previous estimate of $175 billion to $185 billion. Alphabet said in December it would acquire Intersect, a data center company, for $4.75 billion in cash and the assumption of debt. Buy (GOOGL) on dips.
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Panama Canal Fees Soar,
as Asian buyers desperate for oil and gas scramble for global shipping routes, they are upended by the Iran war. Bids for passage have risen tenfold, which, before the war, cost $837,500. Emergency shipment of oil and gas from the US Gulf Coast to Asia is the cause. It’s just one more of the thousands of unintended consequences of the Iran War.
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The Cost of Dating Reaches Record Highs.
Half of single Americans surveyed said they are going on fewer dates or choosing less expensive activities because of rising costs. The bank polled 2,501 adults in late December through January. Nearly half of singles, 47%, said dating just isn't worth the expense, according to the survey. The typical Gen Z American went on about nine dates in the prior year, according to BMO's data. That puts their annual outlay at roughly $1,845. And you wonder why population growth is at century lows.
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Oil Soars $11,
taking Brent to a four-year high of $117 and crushing stocks. President Donald Trump will not lift a naval blockade of Iran's ports until he secures a deal with Tehran to address the country's nuclear program. Trump said he had rejected a recent proposal from Iran to reopen the Strait of Hormuz, which would have delayed talks on the nuclear issue until later. The blockade has caused a global energy crisis, with oil prices continuing to rise and the US military preparing a plan for a short and powerful wave of strikes on Iran to raise pressure on the regime.
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Fed Keeps Interest Rates Unchanged,
citing inflation risks as the main reason for not cutting. Four members dissented for the first time since 1992. Inflation is elevated, in part reflecting the recent increase in global energy prices. This is a shift from the previous language, saying that inflation was just somewhat" elevated. Developments in the Middle East are contributing to a high level of uncertainty about the economic outlook.
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Look for a Longer Iran War,
and much higher gasoline prices. Trump discussed steps the US could take to prolong its blockade of Iran during a meeting with oil and trading industry executives. The meeting included representatives of companies such as Chevron Corp, Trafigura Group, Vitol Group, and Mercuria Energy Group Ltd, and was hosted by Treasury Secretary Scott Bessent. Participants discussed ways the Trump administration could keep up its blockade of Iranian ports while minimizing impact on American consumers, and also spoke about efforts to address the oil market.
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US Trade Deficit Rises,
thanks to soaring imports. The goods trade gap increased 5.3% to $87.9 billion last month, the Commerce Department's Census Bureau said on Wednesday. Economists polled by Reuters had forecast the goods trade deficit at $86.95 billion. It totaled $83.5 billion in February.
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U.S. Single Family Homebuilding Increased to a 13-Month High
in March, but the improvement was likely a blip as permits for future construction fell sharply and confidence among builders remained subdued. Single-family housing starts, which account for the bulk of homebuilding, surged 9.7% to a seasonally adjusted annual rate of 1.032 million units, the highest level since February 2025, the Commerce Department's Census Bureau said on Wednesday.
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Tech has Discounted Great Earnings, but can they deliver?
U.S. stocks are on an impressive run heading into this week’s slate of earnings, with an index of semiconductor names notching its longest winning streak on record, the Magnificent Seven tech giants rising nearly 20% since late March, and the broader (SPY) notching a series of record highs last week that pegs the benchmark well north of the 7000-point mark.
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Schlumberger Jumps on Business Realignment.
It is seeking to recover higher costs from customers after the U.S.-Israeli war on Iran and the effective closure of the Strait of Hormuz disrupted global supply chains. Its shares were up 3.7%. The impact was most pronounced in Qatar due to force majeure and the suspension of offshore operations, and in Iraq due to security conditions. The Middle East is SLB's biggest market. During the quarter, revenue from the Middle East and Asia dropped 10% to $2.69 billion. Buy (SLB) on dips.
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Defense Stocks Buy the Rumor but Sell the News.
Production bottlenecks and uncertainty over the US’s military budget have led investors to sell global defense stocks despite ongoing conflicts in the Middle East. Share prices of leading American defense companies Lockheed Martin (LMT), Northrop Grumman (NOC), and Raytheon (RTX), have all fallen since the US bombed Iran at the end of February, despite the military’s massive expenditure of ordnance over the past two months drawing attention to mounting production backlogs. The US has burned through munitions much faster than it can produce them. The problem is that defense companies may get some money up front, but they don’t typically profit until they deliver years down the road.
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Tesla Lease Returns Set of the Burgeoning Used EV market.
Some 300,000 Tesla’s come off leases this year, and 600,000 in 2027. Residual values have plumed with some models trading at a 60% discount to their purchase prices in only three years. That sets up great deals for consumers now desperate of gasoline alternatives. Some 25% of new cars sold worldwide were EV’s in 2025.
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Baker Hughes Sees Booming Business
as tighter global supplies, driven by the Middle East conflict, highlight the need for investment, particularly in North America. The Iran War has halted 20% of the world's oil that usually flows through the now-closed Strait of Hormuz and shut in 9 million barrels a day of oil production, causing Asian and European countries to scramble for supplies. It has also focused attention on energy security and the need for supply diversity. Buy (BKR) on dips.
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Alphabet to Invest $40 Billion in Anthropic,
popping (GOOGL) shares. Amazon is also investing a further $25 billion. As part of the deal, (GOOGL) is selling 5 gigawatts of compute capacity to Anthropic in another circular chips for equity deal. Buy (GOOGL) and (AMZN) on dips and avoid the Anthropic IPO.
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Physical Oil still Trading at Huge Premiums to the Futures Market.
Roughly 20 million barrels a day of oil supply are bottled up in the Strait of Hormuz, equivalent to 20% of global demand. The current disruption has drawn roughly 500 million barrels from global stockpiles, which could hit a billion barrels by June. Brent crude oil futures are back above $100 a barrel, but the market seems strangely sanguine, especially in longer-dated futures, with prices for 2027 up 17% compared with 43% for front-month contracts. Hedge Funds are making fortunes buying far months futures contracts at $60 a barrel and selling front month at $100.
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The Avis Short Squeeze Ends.
The car-rental company Avis Budget Group Inc.'s (CAR) stock cratered, wiping out all but a sliver of its 600% meme gains over the previous month, in just two days with no clear cause. The sharp rise was a classic short squeeze, in which investors who'd sold borrowed Avis shares started racing to close out those positions by buying them back, but the sudden reversal is much less clear. Avis announced that it would report its first-quarter earnings on April 29, ahead of an expected early-to-mid May date, which ignited speculation that Avis was planning to raise money by selling stock, turbocharging the selloff.
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Intel Rockets 22%, on a spectacular earnings report, and is up 120% so far this year. Given up for dead as recently as a year ago, the company revived on the unlimited demand for AI chips. $1 billion in revenue was lost because the company could not deliver on all its orders, and demand is so great. A big part of the beat came from inventories once thought obsolete, which customers bought anyway, they were so desperate for compute. PC capacity is being shifted over to AI production. At 100X earnings (INTC) is now a strong avoid. The stock is already priced for a comeback that hasn’t finished yet.
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Consumer Sentiment Drops to New Record Low,
down to 48.9, no doubt due to soaring gasoline and food prices. Twelve-month inflation expectations increase sharply. The Iran War has disrupted shipping in the Strait of Hormuz, boosting the price of oil and ultimately the cost of gasoline and diesel. Prices for other commodities, including fertilizers, petrochemicals, and aluminum, which will soon impact consumers, have also surged.
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