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Wall Street sign outside the New York Stock Exchange (NYSE)
This week (April 27 - May 1, US Eastern Time), the New York stock market is also expected to be shaped by the progress of negotiations between the United States and Iran.
Initially, the second round of negotiations between the United States and Iran, which had garnered market expectations, ultimately fell through.
US President Donald Trump announced on the 25th that he did not send his son-in-law Jared Kushner and Middle East envoy Steve Witkoff to Islamabad, Pakistan.
Iranian Foreign Minister Abbas Araghchi also moved to Muscat, the capital of Oman, after meeting with Pakistani leaders in Islamabad.
After leaving Islamabad, Minister Araghchi emphasized to Pakistan that he had "shared Iran's position regarding a practical and viable framework to permanently end the war against Iran," adding that "it remains to be seen whether the United States truly has a serious will to advance diplomacy."
President Trump kept the door open for negotiations, stating, "If they want to negotiate, they just have to call." He also reported that Iran made a new proposal after the cancellation of the negotiations.
Iran's semi-official Mehr news agency reported that Minister Araghchi would return to Pakistan after visiting Oman, suggesting that there are many exchanges of views behind the scenes.
Alex Shahidi, co-Chief Investment Officer (CIO) at Evoke, an asset management firm, warned that negative news related to the Strait of Hormuz could shake the market again, predicting, "Overall, downside risks appear greater than upside."
Jerome Powell, Chairman of the US Federal Reserve (Fed)
Aside from the possibility of negotiations between the US and Iran, there are many important events this week. First, the Federal Open Market Committee (FOMC) will be held on the 29th of this month.
According to the CME FedWatch Tool, the federal funds rate (FFR) futures market reflects a 99.0% probability that the policy rate will remain frozen until April.
The key is the extent to which a consensus has formed among committee members regarding interest rate hikes.
According to the March FOMC minutes, "some" participants stated there was "strong" justification for "two-sided" language in the FOMC statement regarding future rate decisions, reflecting the "possibility that an upward adjustment to the target range for the FFR would be appropriate if inflation were to remain above target."
At the January meeting, only 'several' participants made arguments to this effect. In FOMC minutes drafting conventions, 'several' is a quantitative expression just below 'some'.
If these opinions gain more consensus among committee members at this meeting, expectations for interest rate cuts will recede, likely acting as a bearish factor for the stock market.
March Personal Consumption Expenditures (PCE) data, to be released on the 30th, is also considered a key indicator. In particular, attention is focused on the PCE price index, the inflation gauge used by the Fed. The core PCE price index, which excludes volatile food and energy, is expected to have risen by 0.3% compared to the previous month.
The preliminary estimate for the US first-quarter Gross Domestic Product (GDP) growth rate, also released on the same day, is important. The US releases GDP results three times: preliminary, revised, and final. The first quarter partially overlaps with the timing of the Iran war. However, it is difficult to say that it has been fully reflected. The consensus forecast is an annualized growth of 2.1% compared to the previous quarter.
New York Stock Exchange (NYSE) Trader
Investors will also face the earnings announcements of giant tech companies belonging to the Magnificent Seven (M7).
On the 29th, when the FOMC is held, Meta Platforms (Facebook's parent company), Amazon.com, Microsoft, and Alphabet (Google's parent company) will all release their earnings. A day later, Apple will disclose its performance. This means five of the M7 companies will announce their earnings.
In addition, earnings announcements from companies such as Coca-Cola (28th), Qualcomm (29th), SanDisk, Eli Lilly, and Caterpillar (30th) are also drawing attention.
Particularly for the M7, if earnings fall short compared to their massive capital expenditures, market sentiment could quickly deteriorate. In Microsoft's case, when its October-December earnings last year (Q2 FY2026) failed to meet market expectations, the stock price plummeted. Alphabet and Amazon's cloud business performance is also expected to determine the direction of their stock prices.
The recent bullish trend in the stock market, even amidst the Middle East conflict, is ultimately due to 'earnings expectations.' If these expectations are even slightly missed by investors, the market is likely to be shaken immediately.
Jay Woods, Chief Market Strategist at Freedom Capital Markets, a securities firm, commented, "There has been a significant divergence between war-related headlines and actual market movements," adding, "Ultimately, it is large technology stocks that can bridge that gap and support the market's bottom." He explained that the recent bull market was also "substantially driven by the rebound of technology stocks, especially the so-called M7."
Seasonally, investors enter a period where stock market returns are relatively sluggish, as per the adage 'Sell in May and go away.' According to asset management firm Fidelity, returns from May to October traditionally average around 2% over six months, which is only one-third of the 7% seen from November to April.
CIO Shahidi suggested, "If positions are excessively concentrated in a particular sector and have experienced a significant rebound since the low point, now might be a good opportunity to rebalance positions and move towards a more diversified asset allocation."
New York Stock Exchange (NYSE) Trader
◇Key Schedule and Speeches
- April 27
Corporate Earnings Announcements: Nucor, Verizon Communications, Domino's Pizza
- April 28
February Case-Shiller Home Price Index
April Conference Board (CB) Consumer Confidence Index
Corporate Earnings Announcements: T-Mobile, Starbucks, Visa, Invesco, Coca-Cola, Kimberly-Clark, General Motors, UPS, Hilton Worldwide, Cisco
- April 29
March Durable Goods Orders
March Housing Starts
March Building Permits
Federal Open Market Committee (FOMC)
Jerome Powell, Federal Reserve (Fed) Press Conference
Corporate Earnings Announcements: Meta Platforms, Amazon.com, Microsoft, Alphabet, Qualcomm, Ford, eBay, Carvana, Yum! Brands, General Dynamics, Phillips 66, Biogen
- April 30
Weekly Initial Jobless Claims
March Personal Consumption Expenditures (PCE) Price Index
First Quarter Gross Domestic Product (GDP) Growth Rate Preliminary Estimate
Corporate Earnings Announcements: Apple, Clorox, SanDisk, T. Rowe Price, ConocoPhillips, Eli Lilly, Merck, Caterpillar, Mastercard
- May 1
April US Institute for Supply Management (ISM) Manufacturing Purchasing Managers' Index (PMI)
Corporate Earnings Announcements: ExxonMobil, Chevron, Moderna, Estee Lauder
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