Weekly Market and Earnings Analysis

It was a week of extremes. Markets hit all-time highs, then sold off. Earnings season delivered big beats and bigger punishments. And the Iran situation reminded everyone that one headline can erase days of gains in minutes.

Here’s everything that mattered.

This Substack is reader-supported. To receive new posts and support my work, consider becoming a free or paid subscriber.

Subscribe

The dominant story this week wasn’t earnings. It was geopolitics.

The S&P 500 and Nasdaq finished at record levels on Wednesday after President Trump extended the U.S. ceasefire with Iran, with the S&P 500 closing at 7,137.90 and the Nasdaq at 24,657.57 — a new all-time intraday high.

But the celebration was short-lived. A fresh bout of volatility rattled markets on Thursday as stocks fell and oil rose on concern about escalation of the Middle East conflict, with Brent crude surging to around $105 on fears the Strait of Hormuz closure could worsen energy disruptions.

The pattern this week was clear: good Iran news = markets rally, bad Iran news = markets sell off. Until there’s a formal deal, this will remain the dominant macro variable. Every portfolio needs to account for it.

Tesla was the week’s biggest individual story. The company beat on EPS and posted its strongest gross margins in years — then gave up all its after-hours gains when management revealed a $5 billion capex increase on the earnings call.

The lesson was stark: in this market, it’s not enough to beat. You have to beat and raise guidance. Tesla did the former but surprised negatively on spending, and the stock paid the price.

Full breakdown in our previous post: [Tesla Q1 2026 Earnings: The Numbers Look Good. The Fine Print Doesn’t.]

While Tesla got most of the headlines, two other earnings reports caused serious damage this week.

IBM tumbled 8% after the company beat on both revenue and earnings but maintained its full-year guidance unchanged — disappointing investors who expected a raise. ServiceNow fell 17% after reporting slowing subscription growth.

Both cases reinforced the same theme as Tesla. The market in 2026 is not rewarding companies for meeting expectations. It’s punishing anyone who fails to exceed them. Guidance is everything.

Despite the high-profile stumbles, earnings season is actually going well. Of the 87 S&P 500 companies that have reported so far, 81% have beaten earnings estimates and 76% have topped revenue expectations.

U.S. tech valuations are now in line with the broader S&P 500 even as tech earnings expectations have risen sharply. That’s a meaningful shift from the premium multiples tech carried just a year ago — and it’s part of why the Magnificent Seven recovery has legs.

The S&P 500 hit fresh all-time highs this week but market breadth actually moved lower, with only 56.71% of S&P 500 members trading above their 200-day moving averages. That’s a warning sign. When the index hits records but most stocks are lagging, it means a small number of mega-cap names are doing all the heavy lifting. That kind of rally is fragile.

The biggest week of earnings season starts Tuesday. Alphabet reports April 29. Amazon and Apple follow. Microsoft rounds out the group shortly after. The Magnificent Seven’s recovery thesis will either be confirmed or challenged in the next 10 days.

We’ll have live breakdowns within the hour of each report dropping.

Stay sharp.

No noise. Just signal.

This Substack is reader-supported. To receive new posts and support my work, consider becoming a free or paid subscriber.

Subscribe