Morning Roundup

By Mark Masterson on April 29, 2026

Good morning,

Below are the news items moving markets today:

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Executive Summary

On to Fed Wednesday…..

It’s Jay Powell’s final meeting and press conference before he is replaced by Kevin Warsh. 

I’m not certain what to expect – but I doubt we will get any surprises. 

It’s also a big day for earnings after the closing bell.  Major tech earnings on tap, with more tomorrow. 

Here is the earnings schedule by day…..

Earnings Whispers 4 27 26

Despite the underperformance of the Magnificent 7 this year, earnings growth for the group remains quite extraordinary.

Expectations of roughly 41% earnings growth heading into the bulk of reporting for MAG 7 are by no means a low bar.

Below you can see that expectations for Mag 7 are big this quarter, but start to level off next quarter with the remaining 493 – and into 2027.

As you can see below – nearly all of the returns for stocks this year have come from earnings growth….

It appears much of those earnings are being spent on Capex for the hyperscalers…..

4 29 26

On to Iran…..

This headline dropped last night….

• Trump tells aides to prepare for extended naval blockade in bid to pressure Iran on nuclear issue – media report

Yet, we also see that Iran is expected to submit revised offer as US tightens financial pressure:

• President Trump claimed Iran in “state of collapse” and want US to open Strait of Hormuz as soon as possible while they figure out leadership situation (Bloomberg).
• Meanwhile, CNN sources said Pakistani mediators expect to receive revised proposal from Iran in next few days.
• Comes after Trump said to have expressed dissatisfaction with Iran’s latest offer to reopen Strait of Hormuz, end blockade and punt nuclear talks. Media reports have also discussed how two sides digging in with White House believing blockade will squeeze Iran economically through forced well shut-ins while Iran hardliners banking on Trump blinking first amid rising oil prices.
• US widening efforts to tighten financial pressure on Iran. Treasury Department warned of sanctions on financial institutions associated with China’s independent oil refineries over their role in importing Iranian oil. Comes after US sanctioned China’s Hengli Petrochemical Refinery over its purchases of Iranian crude. Separately, Treasury targeted 35 entities and individuals that oversee Iran’s shadow banking network as part of ‘Economic Fury’. Also warned of significant sanctions related to entities paying tolls to Iran for passage through Strait of Hormuz (Reuters).
• Possible reprieve for Asian countries grappling with tight fuel supplies after FT sources said China set to resume exports of jet fuel, gasoline and diesel from May with major oil companies having applied for export permits. Sources said China believes its own needs for fuel now stable and intends to supply fuel to Asian countries whose stocks are running very low. While Strait of Hormuz flows remain mostly throttled, Japan-linked very large crude carrier (VLCC) carrying 2M barrels of crude appeared to successfully transit through the waterway, marking first such exit since war began (Bloomberg).

Iran conflict:

• Trump tells aides to prepare for extended naval blockade to pressure Iran, unwilling to drop nuclear red lines (link , Bloomberg)
• US confirms continued naval blockade of Iranian ports to limit oil exports and push for negotiations (Bloomberg )
• US military boards commercial vessel Blue Star III suspected of heading to Iran but allows it to continue (AP )
• US blockade heaping pressure on Iran’s battered economy, testing regime’s pain threshold (link)

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Articles of Interest:

• Markets:
  • Treasury traders see longer-dated yields moving past 5% amid inflation risks from oil rally (Bloomberg)
  • Central banks increased gold holdings rapidly in Q1, driven by price slumps encouraging substantial buying (Bloomberg )
  • Rare-earth stocks surge as China plans stricter production oversight and fines for violations (link, Bloomberg )
• Washington:
  • Republican lawmakers explore reducing capital gains taxes to attract voters concerned about rising living costs(Bloomberg )
  • Key congressional Republicans set to oppose Trump’s proposed $1.5T Pentagon budget increase (Bloomberg)
  • GOP divisions stall House progress as lawmakers seek to pass critical funding and reauthorize key programs (link )
• Trade/Tariffs:
  • US Commerce Department ordered multiple chip equipment companies to halt shipments to Hua Hong Semiconductor (Reuters)

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Charts of the day:

It’s Fed day…..

The Fed is in a bit of a box.

You can see below the blue line is the Fed Funds rate.  Its currently at  3.75%.

The 2 year Treasury yield is at 3.85%. (black line)

The Fed funds rate will typically follow the 2 year Treasury – sometimes with a lag

This suggests the Fed has little room to cut rates – and is at risk of having to hike rates should the 2 year yield keep rising.

Interesting to see that the Fed has been buying bonds…..

I know they don’t like to call it QE (Quantitative Easing) – but – it’s the same impact.

The Fed has added ~$200B of US Treasuries back onto its balance sheet in the last few months.

Fred.com 4 29 26

Look at this…..

Semiconductors now make up 14% of the entire US stock market.

That is double the dot-com peak of 7% in 2000.

In 2020 semiconductors were at 4%. Then AI happened.

The weighting went from 4% to 14% in just 5 years. Nvidia alone is now worth $5 trillion.

The last time one sector got this dominant relative to history it did not end well.

4 29 26

According to BofA – AI is now 41% of the index.

That is quite high, and hits same concentration level that resulted in the bursting of previous bubbles, including the Dot Com

4 29 26

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Quote of the day:

“The best portion of a good man’s life is his little, nameless, unremembered acts of kindness and love.”

-William Wordsworth