Crude Crosswinds: Stocks Follow Oil Up, Then Down
Published as of: May 4, 2026, 9:11 a.m. ET
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| The markets | Last price | Change | % change |
|---|---|---|---|
| S&P 500® Index | 7,230.12 | +21.11 | +0.29% |
| Dow Jones Industrial Average® | 49,499.27 | -152.87 | -0.31% |
| Nasdaq Composite® | 25,114.44 | +222.13 | +0.89% |
| 10-year Treasury yield | 4.39% | +0.01 | -- |
| U.S. Dollar Index | 98.31 | +0.16 | +0.16% |
| Cboe Volatility Index® | 17.78 | +0.79 | +4.65% |
| WTI Crude Oil | $102.82 | +$0.86 | +0.86% |
| Bitcoin | $79,255 | +$480 | +0.61% |
(Monday market open) Stocks start the first full week of May near record highs but retreated early as crude rose on media reports of confrontations between ships in the Persian Gulf. Crude came off highs and stocks took back some losses as the open approached and fresh news reports calmed investors. The wobbly start precedes a gauntlet of key data and earnings this week, notably Friday's April nonfarm payrolls report.
Before this morning's pressure, investors seemed to ignore oil and focus mainly on corporate results. With 63% of S&P 500 companies reporting through Friday, blended earnings growth—including companies reporting and estimates for the rest—is an outstanding 27.1%, FactSet said. This would be the highest in more than four years. About 81% of reporting companies have beaten earnings estimates. Much of the growth was fueled by tech, but other sectors also delivered, including discretionary, materials, and financials.
Fresh tech earnings start this afternoon as Palantir (PLTR) reports. Semiconductors come into play with Advanced Micro Devices (AMD) late tomorrow and Arm Holdings (ARM) Wednesday. Wednesday also includes a visit to Walt Disney (DIS), and in all, 20% of S&P 500 companies report this week Indexes mainly climbed Friday, led by tech, but most sectors fell. "While uncertainty around Iran and the trajectory of oil prices persists, investors appear willing to overlook that potential risk," said Nathan Peterson, director of derivatives research and strategy at the Schwab Center for Financial Research (SCFR).
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Three things to watch
- Yen gains could have U.S. yield impact: The yen climbed sharply against the dollar Friday on reports by Reuters and Bloomberg that the Bank of Japan (BoJ) might have intervened to support its ailing currency. A drop in the dollar, if extended, could put pressure on Treasuries as well, providing more power for yields and hurting U.S. stocks. A more active BoJ could also cause higher yields in that market, meaning some money may migrate there from the U.S. and hurt U.S. asset prices. The European Central Bank (ECB), too, is expected to raise rates once or twice this year, analysts told the media. Chances of a rate move in the U.S. after last week's Federal Reserve pause remained unlikely early Monday. Futures trading puts nearly 80% odds of rates staying all year between 3.5% to 3.75%, according to the CME FedWatch Tool. This could mean a narrowing premium for U.S. versus rates in other markets. Jobs data this week could be key, but factory orders data this morning is another possible touchpoint for rates.
- Will the market keep looking past expensive oil? The market showed little sensitivity to spiking crude oil last week, but it's uncertain how long investors can shrug it off. Some analysts note that the U.S. "driving season" traditionally begins after Memorial Day, and with gas going for $4.45 on average, according to AAA, consumers may have to decide whether to travel and pay up or cancel plans, possibly hurting economic growth. A Washington Post survey late last week showed many U.S. consumers already planning to cut back on driving and vacations due to high gas prices, which could hurt all kinds of businesses from gas stations to restaurants to hotels. Airfares have also climbed sharply, which hasn't yet hindered air travel demand but might if it goes on. Norwegian Cruise Line (NCLH) said today that consumers are recalibrating their travel plans, particularly to Europe, and cited "softer demand" overall, and high fuel prices contributed to the shutdown of Spirit Airlines. Meanwhile, long-term borrowing costs continue to rise, perhaps causing hesitancy on large purchases. "The 30-year U.S. Treasury yield is tip toeing to 5%," said Kevin Gordon, head of macro research and strategy at SCFR.
- Chip check: Memory chip stocks continued their rally early Monday, led by Seagate Technology (STX) with 4% gains. Micron (MU) and SanDisk (SNDK) both rose 2.8%. Roaring demand for memory from hyperscalers amid product shortages has raised prices, sending revenue up for memory firms. Chip shares generally gained late last week after stumbling earlier on worries about demand at OpenAI fueled by a news report. "Are chip stocks extended to the upside? Yes," my colleague Peterson said. "But the trend is your friend (until the end, as they say), and it is difficult to predict a near-term countertrend pullback." Also, several AI infrastructure stocks delivered strong earnings and results last week while the Magnificent Seven firms that reported raised capital spending guidance.
On the move
- EBay (EBAY) climbed 8.1% early today on media reports that GameStop (GME) is making a $56 billion takeover bid for eBay.
- Norwegian Cruise Line shares sank 6.5% early today after the company's earnings report came in mixed. The cruise company beat analysts' earnings estimates but came up short on revenue and guided for second quarter and full year fiscal 2026 earnings below consensus, citing disruptions in the Middle East and high fuel prices.
- Palantir climbed 2.3% ahead of its earnings due this afternoon. Analysts expect earnings per share to rise 114.6% year over year and revenue to climb 74%. Last time Palantir reported, in early February, earnings topped Wall Street's expectations and the stock rallied. Since then, it's mainly marched in place, not keeping up with a broader rally in the tech sector.
- Berkshire Hathaway (BRK.B) inched up after it beat earnings and revenue consensus. The company also saw its cash pile rise to almost $397 billion, and bought back about $234 million of its shares, Bloomberg reported. Shares have trailed the market over the last year.
- Shares of crypto-related stocks including Circle Internet Group (CRCL) and Coinbase Global (COIN) popped this morning on news reports that the Senate has reached a bipartisan agreement on language in the CLARITY Act, a digital asset market structure bill. "Should the CLARITY Act pass, it may offer a new narrative for the crypto market, on top of a relatively neutral macro backdrop," said Jim Ferraioli, director of crypto research and strategy at SCFR.
- FedEx (FDX) fell 4% after Amazon (AMZN) announced the launch of Amazon Supply Chain Services, which Amazon said extends the company's entire portfolio of freight, distribution, fulfillment, and parcel shipping solutions to businesses of all types and sizes. United Parcel Service (UPS) fell more than 3%.
- Clorox (CLX) fell 10% Friday as the company cut its outlook even though it posted higher-than-expected quarterly results. The guidance cut reflected an acquisition.
- Software shares found footing Friday ahead of earnings from many major firms in coming weeks. Salesforce (CRM) posted 4% gains, and Palantir (PLTR) rose 3.5%. Other software gainers Friday included ServiceNow (NOW), Microsoft (MSFT), and Adobe (ADBE).
More insights from Schwab
Updated walk through S&P 500 sectors: Check our latest sector views for a monthly outlook from the Schwab Center for Financial Research. In the latest, SCFR said industrials should benefit from increased capital spending in key growth areas around AI, while health care could benefit from technological advances and improved operational efficiencies.
Complacency a concern: Though geopolitics remains a concern, the market is mainly focused on earnings and may continue to look through the Iran situation until data suggests a higher probability of recession or stagflation, Peterson said in the weekly trader's outlook. "While the momentum behind the bull run can persist for longer than anyone thinks, I'm a little concerned …investors may be complacent, getting mesmerized by the bullish momentum."
How major economic events affect investing psychology: The latest episode of Choiceology with Katy Milkman looks at how major economic events affect investors and influence how much risk they're willing to take. One focus is on comedian Groucho Marx and how he fared financially during the Great Depression.
Social Security guidance: Should you take Social Security at 62, 67, 70? Learn more on how to decide the best age to start in our newest look at retirement.
Investing empowerment: Beyond the chance to grow your money, investing has a personal element. Learn the ways investment can empower and some simple steps to get started in Schwab's latest financial planning article.
Chart of the day
Data sources: Cboe. Chart source: thinkorswim® platform.
Past performance is no guarantee of future results.
For illustrative purposes only.
Though stocks made new highs last week, there's a note of caution from the Treasury market. The 10-year yield (TNX-CGI—candlesticks) climbed 10 basis points last week to above its 20-day moving average (pink line). It hasn't been below its 50-day moving average since early in the war, and the 20-day has stayed above the 50-day that entire time, a sign of strength. Higher yields can be a drag on stocks, especially if the 10-year yield again tests highs near 4.5% posted a month ago.
The week ahead
