The S&P 500 (Index: SPX) reached new record highs during the trading week ending on Friday, 1 May 2026. The index closed at 7,230.12 to end the week as investors increasingly put the Iran war geopolitical event into their rear view mirrors.
That's because the event has largely transformed from a kinetic event to the equivalent of an economic siege. Only here, the siege affects the flow of oil through the Hormuz Strait with the U.S. bottling up Islamic Republic of Iran's oil exports while the remnants of Iran's military try to do the same with exports from other nations.
The question investors are weighing now is how long will that state of affairs last? The closure of the Hormuz Strait largely represents the worst case geopolitical scenario and since it has already happened, the risk of the kinetic phase of the conflict resuming doesn't raise the same fears for investors it did when it began, even with oil prices at elevated levels. Because of that, investors are now looking past the event at other factors, because they see the impact of the geopolitical event is diminishing.
That reduced impact can be seen in the latest update of the alternative futures chart, where we find the trajectory of the S&P 500 is moving toward the center of the redzone forecast range we added to the chart before the Iran conflict began. Through 1 May 2026, the S&P 500 is just 2.1% below the center of the redzone forecast range, which is a reasonable projection of where the index would be had the geopolitical event not taken place.
With investors increasingly seeing the Iran War as a past-tense event, other factors like corporate earnings and how the Fed will set interest rates through the rest of 2026 have taken center stage in the market moving headlines of the week that was. Speaking of which, here they are.
- Monday, 27 April 2026
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- Signs and portents for the U.S. economy:
- Oil prices hit two-week high as Iran talks stall and Strait shipments lag
- Price hikes, outlook cuts - What airlines are doing as fuel costs surge
- Fed minions expected to leave U.S. interest rates alone, path for appointment of new chief minion is cleared:
- Fed likely to hold rates steady as Powell prepares for possible swan song
- US Senator Tillis says he's ready to advance confirmation of Warsh as Fed chair
- Bigger trouble, stimulus developing in China:
- China's DeepSeek slashes prices for new AI model
- Under cover of trade truce with Trump, China expands economic pressure toolkit
- BOJ minions expected to leave Japan's interest rates alone, for now:
- Japan's core inflation stays below BOJ target, energy risks grow
- Bank of Japan set to keep rates steady as Iran war clouds outlook
- S&P 500, Nasdaq, close slightly higher in cautious start to a heavy earnings week
- Tuesday, 28 April 2026
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- Signs and portents for the U.S. economy:
- Oil prices hit $110 and stocks fall on Iran impasse and AI
- UAE leaves OPEC in blow to global oil producers' group
- UAE exit weakens OPEC+ power over oil market but group to stay together, sources say
- US pump prices near 4-year high on Iran war disruption, refinery outages
- Fed minions to weigh big changes:
- BOJ minions hold rates steady as expected, excited to hike them in June 2026:
- Wall Street ended lower while oil rallied on UAE OPEC shock
- Wednesday, 29 April 2026
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- Signs and portents for the U.S. economy:
- US single-family housing starts jump to 13-month high in March
- US mortgage rates tick up to 6.37%, MBA says
- Oil soars, stocks dip on Iran worries, earnings in focus after Fed
- Fed minions keep U.S. interest rates unchanged as expected, chief Fed minion says won't undermine incoming new chief minion and that U.S. economy will keep growing:
- Fed holds rates steady amid sharp divide over policy easing bias
- Powell to remain at Fed amid legal 'battering' by Trump administration
- Powell says he won't be a shadow chair, would support Warsh where possible
- US economy 'quite resilient', should keep growing above 2%, Fed's Powell says
- Fed chief nominee Warsh clears key hurdle in Senate confirmation process
- Bigger trouble, signs of growth developing in China:
- China's factory activity set to expand at a slower clip in April: Reuters poll
- China's largest lenders' first-quarter profit up over 3%, sour loan ratios steady
- Bigger trouble developing in Japan:
- Bigger trouble developing in Eurozone:
- Euro zone economic confidence plunges, price pressures soar
- German inflation accelerates to 2.9% in April as energy costs soar
- Euro zone banks tighten access to credit as Iran war bites
- ECB minions thinking harder about ditching their perfect monetary policy for Eurozone:
- Wall Street ended lower after the Fed decision as attention turns to Big Tech earnings
- Thursday, 30 April 2026
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- Signs and portents for the U.S. economy:
- US growth picks up in the first quarter
- Annual US inflation posts biggest gain in nearly three years in March
- Oil retreats after hitting four-year high on concern of US-Iran war escalation
- BOJ minions focus on propping up Japan's currency, getting excited to hike Japan's interest rates:
- BOJ warns inflation could rise well above target in risk scenario
- Yen jumps 3% after officials' 'final warning'; oil swept lower
- BOJ locks in June rate hike in a risky bet that nothing gets worse
- ECB minions leave Eurozone interest rates alone, fret over rising Eurozone inflation and having to dump their perfect monetary policy:
- ECB keeps rates unchanged in a possible last hold before June hike
- Euro zone inflation soars further above ECB target on oil prices
- Bigger trouble developing in Eurozone:
- Stock market hits record high as earnings strength continues
- Friday, 1 May 2026
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- Signs and portents for the U.S. economy:
- Oil prices fall after Iran sends updated peace proposal to mediators in Pakistan
- Trump says Iran war 'terminated,' as war powers deadline arrives
- US manufacturing sector holds steady in April; input costs hit 4-year high
- Fed minions all over the map on direction for next interest rate changes:
- Fed's Logan says central bank's next rate move could be cut or hike
- Fed should ditch rate-cut lean because of oil shock, policymakers say
- Fed's Hammack says no longer appropriate to signal rate cut bias
- BOJ, JapanGov minions working to prop up Japan's currency:
- Yen jumps sharply as Japan warns it is ready to intervene again
- Japan may have spent $35 billion in yen-buying intervention, BOJ data shows
- Bigger trouble developing in Eurozone, ECB minions thinking more about ditching perfect monetary policy:
- Trump says he will raise tariff on autos from European Union to 25%
- ECB policymakers make case for rate hike as inflation may linger
- S&P 500 gains for the week as oil retreats, earnings hold strong
The CME Group's FedWatch Tool continued to anticipate no Federal Reserve rate cuts in 2026, though with a bias for a quarter point rate cut before the end of the year.
The Atlanta Fed's GDPNow tool forecast of real GDP growth in 2026-Q1 held steady at +1.2%, which was lower than the BEA's initial estimate of +2.0% real GDP growth in the quarter. The Atlanta Fed's GDPNow tool first estimate of real GDP growth in the current quarter of 2026-Q2 is +3.7%.
Image credit: Microsoft Copilot Designer. Prompt: "An editorial cartoon of a Wall Street bull and bear who are driving a convertible from the perspective of a passenger in the back seat who see a road sign that says 'NEW RECORD HIGHS AHEAD', while the rear view mirror on the front windshield says 'IRAN WAR' in reversed letters".