US Stocks Hold Highs as Busy Earnings Week Starts: Markets Wrap
(Bloomberg) — US stocks held near record highs at the start of a week that will feature a raft of megacap tech earnings and central bank decisions, with the Strait of Hormuz still shut after efforts to resume US-Iran talks stalled.
S&P 500 futures were little changed. Brent crude rose 1.3% to around $106.70 a barrel after President Donald Trump canceled a trip by top envoys to mediators in Pakistan over the weekend. Tehran signaled it would accept an interim deal to reopen Hormuz in exchange for the US lifting its blockade of Iranian ports, Axios reported Monday.
The S&P 500 is up nearly 10% this month following an unprecedented rally in chipmakers and robust earnings, helping the benchmark recoup all losses after the war in the Middle East upended energy flows. Chip stocks are set for further gains on Monday, with names such as Qualcomm Inc., Sandisk Corp. and Micron Technology Inc. rising in premarket trading.
In what is shaping up to be one of the busiest weeks so far this year, four tech hyperscalers — Alphabet Inc., Microsoft Corp., Amazon.com Inc. and Meta Platforms Inc. — are due to report Wednesday, followed by Apple Inc. a day later. Representing about a quarter of the S&P 500’s market capitalization, the firms will give investors a clear read on whether the rally is sustainable.
Wednesday will see the Federal Reserve deliver its latest interest-rate decision, with central bank officials across the Group of Seven also meeting during the week as investors eye how policymakers confront the risk of a war-driven inflation shock.
“Markets are looking for a new narrative and are jumping back to the AI boom for now,” said Joachim Klement, head of strategy at Panmure Liberum. “However, most investors seem to be guided by uncertainty and are still assessing the fallout from the Iran war. This could mean that a new macro story will emerge soon.”
European stocks advanced 0.2% while Asia tracked Friday’s Wall Street gains. Global bond yields edged higher, with the rate on 10-year Treasuries up two basis points to 4.32%. The dollar weakened 0.3%, while gold traded flat.
“Even if we do get a deal, oil is not going back to pre-war levels,” wrote Mohit Kumar, chief economist and strategist for Europe at Jefferies. “We need to factor in some degree of stagflationary impact. The US should be the least impacted, South Asia the most impacted, while Europe should be somewhere in between.”
In another keenly anticipated event this week, a Senate Banking Committee vote on Kevin Warsh’s nomination as chair of the Federal Reserve is scheduled for Wednesday. Warsh is expected to be swiftly confirmed as Jerome Powell’s successor, whose term ends on May 15, after Republican Senator Thom Tillis said he’s dropping his blockade of the nomination.
At his confirmation hearing last week, Warsh called for a “regime change” in the way the Fed conducts policy. Money markets are currently leaning against any Fed rate cut in 2026.
As for Wednesday’s Fed policy meeting, any meaningful change in guidance will likely be deferred until June, wrote Jim Reid, head of macro research and thematic strategy at Deutsche Bank AG.
“That said, there is a tangible risk that communication skews modestly hawkish,” Reid said. “An explicit acknowledgment that risks to price stability and employment are now more evenly balanced would likely be interpreted as a marginally less accommodative stance.”
Corporate News:
Shell Plc agreed to buy Canadian producer ARC Resources Ltd. for $13.6 billion, in a deal that bolsters the company’s oil and gas reserves and production. Verizon Communications Inc. surprised analysts Monday when it reported a gain of mobile subscribers that overturned Wall Street expectations for losses. United Airlines Holdings Inc. Chief Executive Officer Scott Kirby said he “approached” American Airlines Group Inc. about exploring a combination, though talks have now ended after the target company declined to engage. China has decided to block Meta Platforms Inc.’s $2 billion acquisition of agentic AI startup Manus, making a surprise move to unwind a controversial deal that’s drawn fire for the leakage of technology to the US. Qualcomm Inc. shares jumped in premarket trading on Monday after a closely watched tech industry analyst suggested the chipmaker is working with artificial intelligence giant OpenAI on a smartphone. Nomura Holdings Inc. shares fell after its fourth-quarter profit missed analysts’ estimates, due to writedowns and a loss in Europe. Eli Lilly & Co. agreed to buy closely held Ajax Therapeutics Inc. for as much as $2.3 billion in cash to gain promising experimental medicines for blood cancers. Some of the main moves in markets:
Stocks
S&P 500 futures were little changed as of 8:30 a.m. New York time Nasdaq 100 futures were little changed Futures on the Dow Jones Industrial Average were little changed The Stoxx Europe 600 rose 0.2% The MSCI World Index rose 0.2% Currencies
The Bloomberg Dollar Spot Index fell 0.3% The euro rose 0.2% to $1.1748 The British pound rose 0.3% to $1.3566 The Japanese yen rose 0.2% to 159.14 per dollar Cryptocurrencies
Bitcoin fell 0.6% to $77,763.67 Ether fell 2% to $2,316.8 Bonds
The yield on 10-year Treasuries advanced two basis points to 4.32% Germany’s 10-year yield advanced one basis point to 3.01% Britain’s 10-year yield advanced two basis points to 4.93% Commodities
West Texas Intermediate crude rose 1.2% to $95.55 a barrel Spot gold was little changed This story was produced with the assistance of Bloomberg Automation.
–With assistance from Subrat Patnaik and Neil Campling.
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