The S&P 500 continued its impressive streak, reaching nine consecutive sessions of gains on Friday. Following the announcement of “mutual” tariffs by President Donald Trump on April 2, the index has made a remarkable comeback not witnessed in two decades, effectively eliminating prior losses. This week alone, the S&P gained almost 3%, accompanied by the Dow and NASDAQ, which saw increases of 3% and 3.4%, respectively.
As of April 28, the S&P short range oscillator ended in excess territory for the sixth consecutive session, a trend that often encourages investors to ease their stock holdings. Last week, some profits were taken from CrowdStrike after a notable surge in cybersecurity stocks, which have been standout performers among the S&P 500 and NASDAQ with CrowdStrike rising nearly 29%, compared to a 3.3% and 7% increase for the indices.
Key quarterly revenues from major companies like Microsoft and Meta Platforms also contributed significantly to market optimism last week. Microsoft and Meta topped the list with gains of 11% and 9%, respectively, assuaging investor fears regarding higher taxation threats on AI ventures.
Here’s a brief overview of the earnings reports from these and other notable companies:
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Honeywell: Impressive quarterly results were driven by encouraging comments on managing tariff risks.
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Starbucks: Despite some disappointments this quarter, there’s still hope for a turnaround under CEO Brian Niccol.
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Microsoft: The company’s strong quarterly performance validated its significant investments in AI, particularly in Azure.
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Meta Platforms: Reassured investors amid tariff concerns, with CEO Mark Zuckerberg indicating the company is well-prepared to handle economic uncertainties.
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Eli Lilly: Reported strong sales in its diabetes and obesity product lines, although competition overshadowed its performance.
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Linde: Continued its streak of revenue beats over several quarters.
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Amazon: While guidance was underwhelming, the company maintained its strong rating owing to growth in Amazon Web Services and advertising.
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Apple: Reported better-than-expected iPhone sales but fell short in its services segment.
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DuPont: Its quarter surpassed expectations with notable growth in electronics; it plans to spin off this division by November.
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Eaton: Strong performance attributed to its AI data center solutions, though its connections to other stocks necessitate careful positioning.
This week also brings a focus on revenue amid Federal Reserve anticipation. The Fed’s latest policy meeting starts on Tuesday, with interest rate decisions anticipated by Wednesday afternoon. Market predictions suggest rates will be held steady at 4.25% to 4.5%, similar to previous months. There’s a potential hint of a quarter-point cut in June, but plenty of inquiries await Fed Chair Jerome Powell at the press conference.
Among topics for Powell will be how recent economic data might have altered the Fed’s outlook. He has mentioned the difficulty of navigation when balancing opposing economic goals, particularly in the face of growth slowing alongside rising inflation. Additionally, the ongoing scrutiny of the Fed’s independence continues following criticisms from Trump.
This week, several revenue reports will emerge, including from Disney, Texas Roadhouse, and Coterra, all responding to fluctuating oil and natural gas prices. The challenge remains for Coterra to maintain production while managing capital costs amid a tough year for rough prices in the U.S.
Disney’s upcoming report will spotlight CEO Bob Iger’s streaming strategy and its profitability amidst economic changes and shifts in travel patterns that may impact operations. Texas Roadhouse will be evaluating customer responses to affordability and competition, particularly as industry rival Chili’s had mixed results last week. Factors such as overall economic stability and consumer behavior will increasingly influence outlooks for many companies this week.
