DailyBrief: April 29
Powell's final Fed meeting, Mag 7 earnings tonight, oil and the Hormuz blockade
Markets & Economics
Wall Street pauses ahead of Powell's final Fed meeting and Big Tech earnings
US stock futures drifted in a narrow range early Wednesday as investors awaited the conclusion of the Federal Reserve's April policy meeting and a barrage of mega cap earnings due after the bell. The S&P 500 slipped 0.49% to 7,138.80 on Tuesday and the Nasdaq Composite shed 0.9%, retreating from record highs after a report that OpenAI missed revenue and user targets sparked a selloff in chip and AI infrastructure names. Source: Yahoo Finance
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Fed expected to hold rates steady as Powell prepares to exit
The Federal Open Market Committee is widely expected to leave the federal funds target range unchanged at 4.25% to 4.50% when it concludes its two day meeting on Wednesday, the third consecutive hold. The decision comes against a backdrop of sticky inflation, with core PCE running at 2.8% and headline PCE at 2.6%, lifted by an Iran war driven energy shock. The meeting is likely Chair Jerome Powell's last before his term ends in May, and economists polled by Reuters now expect any rate cut to be pushed to late 2026. Source: CBS News
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Oil holds near multi year highs as Strait of Hormuz remains shut
Brent crude traded near $109 a barrel and West Texas Intermediate held above $97 on Wednesday, after Brent topped $112 earlier in the week. The Iran conflict has entered its ninth week, and a blockade of the Strait of Hormuz, through which roughly a quarter of seaborne crude typically flows, has reduced daily ship transits to nearly zero. The World Bank has called the disruption "the largest oil supply shock on record," and US gasoline prices have climbed to about $4.18 a gallon, complicating the Fed's inflation fight. Source: CNBC
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US consumer confidence unexpectedly climbs in April
The Conference Board's Consumer Confidence Index rose 0.6 points to 92.8 in April, its third straight monthly gain and well ahead of the 89.0 reading economists had forecast. The expectations index gained 1.2 points to 72.2, helped by record tax refunds and a temporary US Iran ceasefire, while the present situation gauge slipped 0.3 points to 123.8 amid concerns over rising gasoline prices. The print suggests US households are weathering the energy shock better than feared, even as inflation stays above the Fed's 2% goal. Source: Bloomberg
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Tech & AI
Alphabet, Amazon, Meta, and Microsoft set to report in 80 second earnings window
Four of the largest US companies, collectively expected to spend between $600 billion and $645 billion on AI capital expenditure this year, will release quarterly results after Wednesday's close. Investors are watching whether Alphabet can sustain roughly 48% growth at Google Cloud, whether Meta can justify a near doubling of capex with stronger ad pricing, whether Microsoft's non OpenAI commercial backlog can stand on its own, and whether Amazon's AWS margins can absorb its roughly $200 billion infrastructure plan. The reports could either validate or unwind the four week rally that has carried US stocks to record highs. Source: Bloomberg
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OpenAI revenue miss drags chipmakers and Oracle lower
A Wall Street Journal report said OpenAI fell short of internal targets for ChatGPT user growth and revenue, missing its goal of 1 billion weekly active accounts by the end of 2025 and losing share to rival Anthropic. The disclosure triggered a sharp selloff in AI infrastructure names on Tuesday: AMD fell about 11% on the week, Broadcom declined roughly 4%, Nvidia and Arm Holdings each slid more than 5% intraday, Oracle dropped 4% on its $300 billion compute deal with OpenAI, and SoftBank, a major OpenAI backer, sank around 10% in Tokyo. OpenAI dismissed the report as "prime clickbait." Source: CNBC
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