Stocks Slip, Oil Up to Start Crowded Earnings Week

Published as of: April 27, 2026, 9:09 a.m. ET

(Monday market open) Three central bank meetings and five Magnificent Seven earnings reports await investors this week, along with earnings from around one-third of S&P 500 companies. Today's calendar is light, though, and major indexes took a breather from last week's sizzling rally, hesitant after anticipated peace talks failed to materialize and crude oil resumed its climb. News reports today said Iran offered the U.S. a deal to reopen the Strait of Hormuz but postpone nuclear talks.

The marathon round of central bank meetings starts tomorrow with the Bank of Japan (BoJ), followed quickly by the Federal Reserve on Wednesday and the European Central Bank (ECB) on Thursday. Though none are expected to raise or lower rates, the fast pace could drive market volatility and reverberate around the Treasury market. Yields inched up this morning and remain elevated after climbing last week across the curve, a possible drag on stocks.

The S&P 500 Index and Nasdaq Composite carved new record highs Friday and are up four straight weeks. "Earnings from chip stocks helped fuel investor demand," said Nathan Peterson, director of derivatives research and strategy at the Schwab Center for Financial Research (SCFR). "The chip rally has been historic, and it speaks to the strength of the AI buildout theme and the insatiable demand for compute." There's potential for a pullback in chips later this week if capital expenditures guidance from the Magnificent Seven doesn't meet expectations, Peterson said, adding the market could continue to climb even if the chip sector consolidates.

1. Rally narrows, raising concern: About 53% of S&P 500 stocks now trade above their 50-day moving average, down from 60% a week ago, representing a decline in market breadth. Last week saw just 188 S&P 500 stocks climb, down from 406 during the first week of April when rising waves lifted far more boats. The narrowing suggests mega-cap and large-cap tech continue to be the main drivers of the recent bull run. Typically, broader participation suggests healthy investor sentiment and supportive technicals. Participation is just one metric useful for sensing where stocks might be headed. The current level near 70 for the Relative Strength Index (RSI) of the S&P 500 Index also raises concern. That mark typically signals overbought conditions. The RSI for chip stocks is above 80 (see chart below). Tracking RSI can help investors get a sense of how much momentum might remain in a rally.
    
2. Pondering Powell's future at Fed: The Fed's Wednesday press conference lost some drama after the Justice Department announced Friday the end of its criminal investigation into Fed Chairman Jerome Powell. This likely clears the way for the Senate to confirm nominee Kevin Warsh by May 15 when Powell's term ends. "The intrigue now shifts to whether Powell will stay on as a 'regular' Fed governor, since his term runs until 2028," said Michael Townsend, managing director of legislative and regulatory affairs at Schwab. "Doing so would block the president from nominating someone to an open seat." The investigation is essentially now in the hands of the Fed's inspector general. U.S. Attorney Jeanine Pirro, who said Friday that the Justice Department "will not hesitate to restart a criminal investigation should the facts warrant doing so." Would Powell rather be at the Fed if an investigation restarted, or a private citizen? That could inform his decision. "I'm in the camp that he stays, but it's pretty much 50/50," Townsend said. If Powell stayed, he might remain another hawkish voice on the Federal Open Market Committee (FOMC), countering Warsh's dovish tenor.
    
3. Auctions, ECB and BOJ meetings could affect yields: Several key auctions take place for Treasuries this week, which could give investors a sense of demand for U.S. assets from overseas buyers that typically make up an important customer base. Sets of 2-year and 5-year notes go on the block later today, with results likely this afternoon. Any dip in buying might be another tailwind for yields. Yields—which move the opposite way of the underlying Treasuries—might also take dictation from this week's rate-setting meetings here and abroad. The war could pressure central banks to at least consider higher rates to blunt the impact of crude-fueled inflation. Investors still see two ECB hikes later this year, according to the Financial Times. The BOJ is unlikely to raise rates tomorrow, but a June hike can't be ruled out, Bloomberg reported. The Fed is expected to pause again, and Warsh taking over probably won't affect the Fed's policy path. "This doesn't change our monetary outlook for the rest of the year," said Collin Martin, head of fixed income research and strategy at SCFR. "We expect zero or one rate cut by the end of the year, and Warsh would likely have a difficult time convincing enough voting members to get on board with cuts given the expected short-term increase in inflation."

• Qualcomm (QCOM) soared 9% ahead of the open following an analyst report saying OpenAI is working with MediaTek and Qualcomm to develop smartphone processors. Apple (AAPL) dropped 1.5% on the news, as this could represent phone competition.
   
• Domino's Pizza (DPZ) cooled 7% early today after earnings and revenue came in shy of Wall Street's expectations and the company's U.S. sales forecast appeared to disappoint.
   
• Adobe (ADBE) fell nearly 2% in early trading, hurt by a downgrade from Mizuho to neutral from outperform. The analyst cited competitive threats from AI, lack of catalysts, and risk of margin erosion.
   
• Verizon (VZ) climbed 2.6% early despite quarterly revenue narrowly missing consensus. Earnings per share topped expectations and the company raised guidance. Another lift came from subscribership, with 55,000 net postpaid phone subscribers added in what's traditionally a tough quarter. Analysts had expected subscribership to fall.
   
• Organon (OGN) soared 17% ahead of the open after announcing it will be acquired by Sun Pharma for $11.75 billion.
   
• Intel (INTC) rose 23.6% on Friday for its best day since 1987. Advanced Micro Devices (AMD) appeared to benefit Friday from Intel's sharp gains, as AMD is Intel's main competitor in the CPU market. As AI workloads shift away from training large language models and toward AI agents using models to execute tasks—which analysts call "inference"—CPUs have become critical, Barron's reported Friday.
   
• Health care had a tough Friday. Shares of Eli Lilly (LLY) and HCA Healthcare (HCA) both fell, with Lilly hurt by data suggesting a slow start for its new obesity pill, according to Bloomberg, and HCA damaged by weaker-than-expected first quarter patient volumes.
   
• Though the Magnificent Seven dominate earnings in days ahead, there's plenty of additional action in one of the most crowded earnings weeks on the quarterly calendar. To date, 28% of S&P 500 companies have reported, and 84% have beaten earnings expectations, FactSet said Friday. That's historically strong, and so is the 81% that have beaten revenue consensus. Annual S&P 500 earnings growth is now seen at 15.1%, FactSet said, up from 13.1% a week earlier, as margins improve.

Trader's corner: If you trade regularly, you might find useful insights and data in Schwab's Weekly Trader's Outlook. This week's column points out that Q1 earnings, along with CEO commentary, have been relatively strong and earnings per share revisions have been moving higher.

The PHLX Semiconductor Index (SOX—candlesticks) is up around 33% over the last three months, outpacing gains of 6% for the Nasdaq-100^® (NDX—blue line) and 3% for the S&P 500 Index (SPX—purple line). At the same time, the Relative Strength Index, or RSI, for the chip sector (bottom chart) climbed above 85 last week from below 40 less than a month ago. Anything above 70 is traditionally considered overbought. While an overbought market can keep climbing, this setup could make chips more vulnerable if there's bad news. The index is up 18 straight sessions and almost 50% from its March lows, driven by what appears to be speculative momentum. These types of extreme moves show a lot of bullish sentiment but also might be a reason to consider proceeding with caution.