Markets ended a busy week higher with the S&P 500 closing at a new record. For the month of April, the S&P 500 jumped 10.4%, its largest monthly gain since November 2020. Events in the Middle East, the Fed’s April FOMC meeting, and earnings reports all vied for investors’ attention.
Events in the Middle East largely remained at a stalemate. Early in the week Iran submitted a proposal that would reopen the Strait of Hormuz but did not address the country’s nuclear ambitions, garnering a tepid US response. Over the weekend, President Trump announced the US will begin to “guide” ships through the Strait of Hormuz this upcoming week. Still unclear is whether the US Navy will directly escort ships or if they will be guided by other means. On Sunday, two vessels near the Strait reported being attacked, keeping tension elevated.
As expected the Fed left rates unchanged at its April meeting. Three members who supported the action objected to the statement’s easing bias suggesting the possibility of further rate cuts in 2026. At his post-meeting press conference, Chair Powell addressed speculation about his future saying he intends to remain on the Board of Governors “for a period of time, to be determined” following the end of his term as Fed Chair. Powell later said he worries that the political attacks on the Fed are “battering this institution and putting at risk the things that really matter to the public,” the ability to conduct monetary policy free from political factors.
Through Friday, 63% of S&P 500 companies had reported 1Q26 earnings, with 84% of those companies beating their consensus estimate. According to industry group FactSet, consolidated earnings growth for 1Q26 is expected to be 27.1%, which if achieved, would mark the 6th consecutive quarter of double-digit earnings growth.
