Things you need to know
- History was made on Wednesday -S&P 500 closes above 7,000, Nasdaq punches through 24,000.
- Iran diplomacy doing the heavy lifting — hope is a powerful drug.
- Big bank earnings keep rolling in strong — the numbers don’t lie.
- Fed Chair drama heating up — Warsh on deck.
- Oil pulling back from its war highs. Bonds down, Gold churns.
- VIX moves lower.
- Try the Spaghetti alla Nerano.
Good morning America! Can we talk?
Stocks continue to surge…the S&P up 11% in the last 15 days…the Nasdaq up 16% during that same time…both ending yesterday at new all-time highs….
From the leaderboard – here is how yesterday ended….the Dow lost 72 pts, the S&P added 55 pts, the Nasdaq added 376 pts, the Russell ended up 8 pts, the Transports gave back 316 pts, the Equal Weight S&P lost 60 pts while the Mag 7 exploded again – rising 816 pts.
As you can see the leadership coming from the beaten up, oversold tech sector…. names that you all know…… Because the theme is clear, it’s the chip trade, the AI infrastructure buildout, but it is also the Iran ceasefire optimism all converging at once.
President Trump told Fox Business Tuesday morning — in an interview with Maria — that the war is “very close to over.” He added that he believes Iran “wants to make a deal very badly.” Investors, traders and algos ran with it.
The reality, of course, is more complicated. The U.S. and Iran remain in communication through Pakistan as an intermediary, but no extension of the current two-week ceasefire has been formally agreed to. A senior U.S. official told reporters the U.S. “has not formally agreed” to an extension, even as the AP reported an “in principle” understanding was taking shape.
The ceasefire clock is ticking — it expires next week — and the IDF made clear it remains “prepared to attack again in a powerful manner” if a deal falls apart. Iran’s foreign ministry is calling some U.S. demands “unreasonable and unrealistic” (yawn) and insisting on its right to enrich uranium for peaceful purposes.
So, we have a fragile ceasefire, a U.S. naval blockade that is choking Iran economically and is now fully implemented around all Iranian ports, and diplomatic back-channels working overtime. The market is choosing to focus on the optimistic interpretation — and when you combine that narrative with big tech roaring back, you get this week’s excitement.
Here is ‘just a taste’ of the excitement – but trust me, the story is bigger….
Micron Technology (MU) — Semiconductors/Memory
This IS the standout name of the past week, not even a question…. Up 31% over the past eight sessions, and up 40% since the beginning of April. The story is not complicated: AI is eating memory chips, Micron is sold out of its 2026 HBM inventory, leaving the market in a frenzy.
Broadcom (AVGO) — Semiconductors/Custom AI Chips
Up 27% over the past eight sessions. The custom AI chip business is exploding — AI revenues for Q1 2026 were $8.4 billion, up 106% year over year, and management is guiding Q2 AI revenues to $10.7 billion. Meta just expanded its chip deal with them too. The Momo guys are having a field day…..
Advanced Micro Devices (AMD) — Semiconductors/GPUs
Up 25% over the past eight sessions. AMD has been riding the same AI infrastructure wave as Nvidia…. The upcoming MI450X accelerator launch later this year has investors tripping over each other to ‘get in’…….
Nvidia (NVDA) — Semiconductors/GPUs
Up 14% over the past eight sessions, and the stock just clinched its 11th consecutive daily gain — the longest winning streak in its history. The NVDA freight train keeps rolling and it is still the name everyone comes back to when the AI trade heats up.
Microsoft (MSFT) — Mega-Cap Tech/Cloud/AI
Up 4.63% on Wednesday alone, and 16.5% since April 1st….. Azure AI demand, the Meta deal to deploy a gigawatt of custom AI chips, and the broader risk-on sentiment have all been tailwinds. Earnings coming next week – Strap in! ….
I featured this name on my Yahoo Podcast (Trader Talk) on April 8th in a discussion with Josh Shafer of Barron’s, Barbara Doran CEO at BD8 Capital Partners and – my daughter – Amanda – Former Head of People Ops at Ellevest – saying it was a SCREAMING BUY!
https://finance.yahoo.com/video/why-microsoft-is-a-screaming-buy-120727667.html
Tesla (TSLA) — EV/AI/Robotics
Up 7.63% on Wednesday after a UBS upgrade and Elon teasing the new AI5 chip on X. It is up 17% in one week and while still about 12% on the year, the past week has been a strong bounce. And in more news – The Netherlands – on April 10th became the first EU country to approve Tesla’s Full Self-Driving software — a meaningful regulatory win that has only added ‘fuel’ to this recent rally.
Earnings – the banks delivered. The message from the banks this quarter is consistent: volatile markets are good for trading desks, deal-making is coming back, and consumers are still spending. That’s not a recessionary narrative. Not even close. Yesterday we heard from:
Bank of America reported net income of $8.6 billion — up 17% year over year — with EPS of $1.11 coming in well ahead of the $1.01 consensus estimate. That’s the highest earnings per share BofA has produced in almost two decades, and the 23rd consecutive quarter the bank has beaten EPS expectations. Revenue climbed 7% to $30.4 billion. Equities trading was the star of the show, with revenue surging 30% to $2.83 billion — the trading desk’s best quarter in 15 years. Net interest income grew 9% to $15.9 billion. Investment banking added 21%.
Morgan Stanley put up what CEO Ted Pick called a “record quarter.” Revenue of $20.6 billion, up from $17.7 billion a year ago. EPS of $3.43 — versus estimates of $3.02 — representing a 29% jump in profit. Equities trading hit a record $5.15 billion. Investment banking fees climbed 36%. Wealth management brought in $118 billion in net new assets.
The bond market is taking it all in stride. The TLT and TLH both lost a bit of ground yesterday after rallying off the March lows…. The 10-year yield held steady at 4.28% while the 30-yr held steady at 4.89%. Yields have actually drifted lower since April 1st – the 10 yr down from 4.48% while the 30 is down from 5% – as the ceasefire took hold and oil prices pulled back from their highs.
Oil continues to be the one to watch above everything else right now, and Wednesday’s close at $91.22 – essentially left it flat on the day and that tells you the market is comfortable right here. Remember, WTI was trading at $67 before this war started. It spiked above $115 at its worst moments. The current $91 level represents the market pricing in a messy-but-manageable outcome — ceasefire holds, some diplomatic progress, Strait of Hormuz gradually normalizing. A scenario that suggests a ‘happy ending’.
Now IF it all breaks down then don’t be surprised to see oil make a run back toward $100+. And if that happens, watch stocks cool off in a hurry. The inverse relationship between crude prices and stock prices has never been more direct than it is right now.
Gold is trading at $4,808 up $17 this morning but down from $4,870 yesterday morning. And it remains stuck in that $4,700/$4,900 range. Gold is not sure what to do…..Stocks are up, the conflict is ‘on hold for now’, rates are holding steady, the FED is not cutting, inflation is ‘iffy’ and so gold churns. Gold has been the ‘safety trade’ all year. As peace talk optimism grows, you can expect some of that ‘safety premium’ to evaporate. Still, at $4,808, gold is not exactly cheap — it’s just acknowledging that the worst-case scenario (which includes the conflict and inflation) looks a little less likely today than it did last week.
The VIX at 18.17 is the number I’m keeping an eye on. It has been moving lower, and this morning it’s down again — trading at 18.11 — and that’s consistent with the recent rally in stocks. But here’s the question: Is the VIX declining because stocks are rallying, or are stocks rallying because the VIX is declining? It’s like the chicken and the egg -which came first?
Either way, we’re still in cautious territory — but drifting toward the complacency zone, which is sub-15. So, until we have a signed, sealed and delivered deal on Iran, oil trading in the mid-to-low 70s, and some clarity on when Kevy Warsh actually takes the keys at the Fed — we’re not there, so stay awake!
What to watch today – because there is a lot….. Initial Jobless Claims and Cont. Claims, Advance Retail Sales and the Philly Fed Manufacturing Survey all hit at 8:30. Industrial Production and Capacity Utilization follow at 9:15. Now for me – I do not think any of this will really move the needle, but you do you.
The Warsh confirmation hearing is April 21st, but surely we can expect pre-hearing noise. Any ‘Tommy T’ comments, DOJ updates, or Powell statements could move rate-sensitive sectors. Again, to me it’s all noise – so I’m tuning it out, but you do you.
There are 5 names worth watching today…
Taiwan Semiconductor (TSM) — Technology/Semiconductors. The most important report of the week, bar none. They reported overnight and they BEAT and they tell us that chip demand momentum is continuing…. The stock is up 24.5% ytd.
Netflix (NFLX) — Communication Services/Streaming. Netflix just raised subscription prices across all plans, so the Street wants to know: did subscribers walk, or did they shrug and pay up? Management’s 2026 revenue guidance range sits at $50.7–$51.7 billion — watch whether they bump it. They’re also targeting a $20 billion content budget this year. If the price hikes held and subscribers grew, this one could be a mover. The stock is up 14.8% ytd.
PepsiCo (PEP) — Consumer Staples. Pepsi is a direct read on consumer spending and corporate pricing power. With inflation running at 3.3% annually and the Iran energy shock still working through the system, what management says about input costs and consumer behavior will matter well beyond just the stock price. The stock is up 7.9% ytd.
Travelers (TRV) — Financials/Insurance. One of only 30 Dow components reporting this week. Insurance is a real-world barometer of risk — claims, catastrophe exposure, underwriting margins. In an environment where geopolitical risk is elevated and energy costs remain well above pre-war levels, what Travelers says about how they’re pricing risk in this environment will be worth listening to. The stock is up 3.2% ytd.
KeyCorp (KEY) — Financials/Regional Banking. After the monster prints from JPMorgan, BofA, and Morgan Stanley this week, the question is whether the regional banks are telling the same story. KeyCorp is Main Street vs. Wall Street — a read on credit quality, loan demand, and whether the consumer is actually as healthy as the big banks suggest. The stock is 4.5% ytd.
US futures are up…. Dow futures +50, S&P’s +2, Nasdaq +13 and the Russell is flat.
The S&P closed at 7,022 – welcome to a new century…. Now, the question is, can it hold? Well, that depends on what happens next with Iran, oil and the Strait of Hormuz…. or are we calling it the Trump Strait now? (Just kidding!!!)
From a technical perspective – trendline support is now 6,815 – which is down 3% from here…..something that is not out of the question considering all of the anxiety around ceasefire talks and normalization of trade. A trendline drawn off the high in Oct – to the highs in February suggests that we will find resistance at the 7,075 ish. So, the new range – 6,815/7,075 for now.
Call me at 561-931-0190 and let’s talk about how SlateStone Wealth can help you navigate all of this and reach your goals.
Take good care,
Kp
[email protected]
Source: Bloomberg, CNBC, Reuters, Wall Street Journal
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Spaghetti alla Nerano
Born in 1952 at Ristorante Maria Grazia in the tiny coastal village of Nerano on the Amalfi Coast, Spaghetti alla Nerano is one of those dishes that proves the Italians have always understood that simplicity, done with intention, is the highest form of cooking.
For this you need: 5 or 6 small, sweet zucchini’s and I say that because larger ones tend to turn bitter, olive oil, basil, spaghetti, butter, garlic cloves and the cheeses. Now this is really important – what you want is Provolone Del Monaco – but if you can’t get it, you can use Provolone Picante. You also need fresh grated Parmegiana. Now some people use Pecorino Romano instead – either is fine, but do not use both – in they end they will give you different flavors – one warm and nutty, the other a bit more tangy.
Start by slicing the zucchini almost paper thin using a mandoline.
Next – fry them in batches in plenty of hot extra-virgin olive oil until they turn golden and just start to crisp at the edges. Drain them on paper towels, scatter torn fresh basil over the top, and let them sit. Dust with parmegiana. This is not optional. It’s where the magic happens.
Now bring a pot of salted water to a rolling boil and add the spaghetti – leaving it just a tiny bit undercooked.
While that is happening – In a large sauté pan – heat up some olive oil and toss in 2 or 3 cloves of garlic – not sliced. Once it begins to take on a golden color – remove.
Now, add back the zucchini with a dollop of butter and a ladle of pasta water.
Using tongs – move the spaghetti from the pot into the sauté pan – tossing with the zucchini.
Now comes the cheese – and do not chintz…use plenty of cheese…. grate the Provolone – continue to toss, add more pasta water to help it emulsify. Finish this with a handful or two of the fresh grated parmegiana – toss to coat…. Yum.
Plate it immediately — this dish waits for no one. Close your eyes for the first bite. This is a memory you haven’t made yet.
Buon Appetito