Bracing for the next step
TSLA and GOOGL earnings and Fed speakers this week
Quick summary:
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Markets slid sharply last week after Powell warned tariffs could fuel inflation, with the S&P 500 down 3% and the Nasdaq off 4%.
Q1 GDP estimates fell to -2.2%, and early earnings results have underwhelmed, with only 12% of S&P 500 companies reporting so far.
This week brings more Fed speeches, key economic data, big earnings (TSLA and GOOGL among them) all of which could shape short-term sentiment amid ongoing tariff uncertainty.
We will revisit the earnings reactions on Saturday in the paid section.
The competition
The action doesn’t stop in Week 4 of the competition. After last week’s (and yesterday’s) sharp market drop—triggered by Powell’s tough stance on inflation and tariffs—volatility remains the theme. With more Fed officials speaking and key data like consumer sentiment and PMI ahead. It’s the kind of week where staying sharp could mean climbing the leaderboard—or falling behind.
Keep your strategies sharp and your eyes on the top!
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Last week’s performance
Markets didn’t take the Easter break as a cue to relax. Powell’s Wednesday speech sparked a sharp sell-off, with the S&P 500 down 3% and the Nasdaq dropping 4%, after he signaled no rate cuts ahead and warned that tariffs could fuel inflation. The Fed’s stance is firm, and chatter about a “shadow Fed Chairman” being lined up by the Trump camp is only adding to the tension. A potential standoff between Trump and Powell might define the next chapter of 2025—and not in a good way.
The sell-off continued on Monday as there was no sign of a trade deal over the long weekend, although the administration did announce they were “close to a deal with Japan” —as we expected. Japan is heavily reliant on U.S. trade, and the strategic alignment makes it a logical first win. But without a finalized agreement, markets stayed shaky. Q1 GDP estimates have now dropped to -2.2% (from 3% two months ago), and earnings season is off to a weaker-than-usual start. Only 12% of S&P 500 companies have reported so far, with earnings beats and surprise magnitude both below average. Expectations were already cut to 7.8% growth for Q1, down from 10% earlier this year, and unless forward guidance improves fast, the path of least resistance could be down.
This week, markets will be watching for more clues as Fed officials—including Waller, Kashkari, and Harker—are scheduled to speak. Their comments could provide fresh direction following Powell’s hawkish tone. Wednesday’s Beige Book will offer a broader economic snapshot ahead of the May Fed meeting. On the data front, consumer sentiment, new home sales, and durable goods orders are all due, giving a closer look at how tariffs are weighing on demand.
Tesla’s earnings report are out today after close, and Google is on Thursday. Tesla will be particularly interesting to watch for what it signals about global supply chain pressures and tariff impacts. The company has already seen its stock drop over 30% this year, and markets will be watching for any forward guidance that might shift sentiment—at least in the short term.
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