General Market News

Kevin Warsh's nomination to succeed Jerome Powell as Federal Reserve Chair advanced through the Senate Banking Committee on a party-line vote, clearing the way for potential confirmation by mid-May. The process unfolds amid White House pressure on the Fed and controversy over a DOJ investigation into Powell. Democrats oppose Warsh, doubting his commitment to independence from presidential influence.

• The Senate Banking Committee voted 13-11 along party lines to advance Warsh's nomination after the DOJ dropped its investigation into Powell on April 25
• The full Senate could vote the week of May 11, potentially allowing Warsh to be sworn in by May 15 when Powell's leadership term ends, though uncertainty remains about whether Powell will stay on the Fed Board through January 2028
• The Fed is expected to hold rates steady at 3.50%-3.75% amid elevated inflation, while Trump has repeatedly stated he wants Warsh to deliver rate cuts

UBS warns that incoming Federal Reserve Chair Kevin Warsh plans to abandon forward guidance and the gradualist approach used by predecessors like Ben Bernanke, marking a fundamental shift in how the Fed communicates policy. Warsh favors making rate decisions 'in the room' without telegraphing moves in advance, which UBS expects to increase market volatility. The change has already impacted markets, with gold prices falling 14% since Warsh's nomination in late January.

• Warsh explicitly rejects forward guidance, arguing it limited the Fed's flexibility during the 2021-2022 inflation surge, preferring a 'cold turkey strategy' of single-step rate moves without advance signaling
• UBS expects flattening pressure on the 5s30s Treasury yield curve and was stopped out of a rates trade positioned for aggressive 2027 easing after Warsh declined to offer dovish guidance
• Gold has fallen approximately 14% since Warsh's nomination, consistent with markets pricing in a tighter and less predictable monetary environment, while UBS forecasts slow balance sheet reduction starting at $25 billion monthly purchases

German-French tank maker KNDS has launched an internal investigation into alleged bribery related to a 2013 arms deal with Qatar worth 1.89 billion euros. The probe examines multi-million-euro commission payments allegedly made to a consultancy controlled by a Qatari general, though KNDS states it has found no evidence of employee wrongdoing to date.

• The 2013 deal involved 24 PzH 2000 artillery systems, 62 Leopard 2 tanks, and additional defense equipment worth 1.89 billion euros ($2.21 billion)
• Auditor PwC has withheld approval of KNDS's 2025 annual accounts due to the investigation, creating uncertainty around the company's planned stock market listing, though KNDS expects finalization in May
• Law firm Freshfields is conducting the review of the Qatar transactions originally signed by KNDS predecessor Krauss-Maffei Wegmann

PJM Interconnection, the largest U.S. power grid operator serving 13 states and one in five Americans, will begin processing new power plant applications this week after clearing a years-long backlog. The grid operator received over 800 new generation project applications totaling 220 gigawatts of capacity, addressing electricity shortfalls driven by surging data center demand.

• PJM had frozen new applications in 2022 to process backlogs and implement reforms, processing 170 gigawatts by end of 2025 with 31% offered or signed connection agreements
• The 800+ new applications include 349 battery storage projects, 157 natural gas plants, 142 solar farms, 65 wind farms, and 45 nuclear energy projects
• Clean energy advocates welcome the queue reopening but emphasize the need for faster project connections to meet growing electricity demand

U.S. crude oil inventories fell by 6.2 million barrels in the week ended April 24, significantly exceeding analyst expectations of a 231,000-barrel draw, according to the Energy Information Administration. Gasoline and distillate stockpiles also declined more than anticipated, dropping 6.1 million and 4.5 million barrels respectively. The larger-than-expected inventory drawdowns pushed oil futures up approximately 5%, with Brent crude rising to $116.85 and WTI to $104.67 per barrel.

• Crude inventories decreased to 459.5 million barrels, a draw nearly 27 times larger than the expected 231,000-barrel decline
• Gasoline stocks fell 6.1 million barrels (versus 2.1 million expected) while distillate inventories dropped 4.5 million barrels (versus 2.2 million expected)
• Refinery utilization increased by 0.5 percentage points and crude runs rose by 84,000 barrels per day, while net crude imports dropped by 1.97 million barrels per day

Kevin Warsh's nomination to become Federal Reserve Chair advanced through the Senate Banking Committee with a 13-11 vote, clearing a major hurdle after Sen. Thom Tillis lifted his opposition. The North Carolina senator had blocked the nomination over concerns about a DOJ investigation into current Fed Chair Jerome Powell, which has since been closed. Warsh could be confirmed in time to preside over the Fed's June policy meeting.

• Warsh, a former Fed governor (2006-2011), would replace Jerome Powell, whose term as chair ends May 15, 2026, though Powell could remain on the Board of Governors until January 2028
• Sen. Tillis removed his hold after the DOJ closed its politically controversial investigation into Powell's testimony regarding the Fed's renovation project, with oversight transferred to the Fed's inspector general
• The full Senate confirmation vote could occur soon, potentially allowing Warsh to take over before the June Federal Open Market Committee meeting

The Senate Banking Committee voted along party lines to advance Kevin Warsh's nomination to lead the Federal Reserve, moving President Trump's pick toward final confirmation in the Republican-controlled Senate. The vote came hours before the Fed's latest interest rate decision, potentially the last under current chair Jerome Powell, amid ongoing tensions between Trump and the central bank over monetary policy.

• The committee vote was 13-11 along party lines, with all Republicans supporting and all Democrats opposing Warsh's nomination
• A DOJ criminal investigation into Powell, widely seen as retaliation for the Fed's interest rate decisions, was dropped days before the vote after Sen. Thom Tillis threatened to block Warsh unless the probe ended
• The Fed is expected to maintain current rates due to sticky inflation and geopolitical price shocks, continuing the cautious approach that has drawn Trump's criticism

U.S. stock indices rallied on April 29, 2026, following rumors that President Trump may be willing to negotiate an end to an ongoing war even with the Strait of Hormuz still closed. The Nasdaq 100, Dow Jones 30, and S&P 500 all attempted recoveries, though analysts remain cautious about the sustainability of the rally given recent bearish market conditions.

• The Nasdaq 100 rallied toward the 23,800 level based on speculation about war negotiations, though the author expresses skepticism about the rumor's credibility
• The Dow Jones 30 is testing a crucial support level at 45,750, with potential to reach 46,000 if the level holds
• The S&P 500 needs to hold above 6,300 to avoid further bearish pressure, with resistance at 6,500, and analysts recommend waiting several days before committing significant capital

Franco-German tank maker KNDS announced it investigated a 2013 defense deal with Qatar's armed forces and found no evidence of criminal misconduct by current or former employees. The investigation, conducted by external legal counsel, examined contracts originally signed by predecessor Krauss-Maffei Wegmann for artillery systems, tanks, and related equipment.

• The contracts covered 24 PzH 2000 artillery systems, 62 Leopard 2 tanks, plus additional defense equipment, services, training, and simulation equipment
• The investigation is 'well advanced' but not yet complete, with external legal and advisory firms conducting the review
• No evidence found to date suggests any KNDS employees, past or present, engaged in criminal misconduct related to the Qatar transaction

Wall Street opened lower on Wednesday as the Dow fell 92 points and the S&P 500 dropped 0.18%, with investors awaiting a Federal Reserve policy decision and earnings reports from four major tech companies including Amazon, Meta, Microsoft, and Alphabet. Rising oil prices above $104 per barrel due to Iran tensions and concerns about AI spending sustainability added to market caution.

• The Fed is expected to hold rates steady in what may be Chair Jerome Powell's final meeting before Kevin Warsh's succession, with markets watching for inflation commentary amid elevated oil prices
• Big Tech earnings will focus on AI investment justification after OpenAI reportedly missed internal growth targets, testing the semiconductor sector's 41.7% year-to-date rally
• Individual stocks showed volatility: Robinhood fell 12% on missed profit expectations while NXP Semiconductors surged 23% on strong guidance, and oil prices jumped over 4% on US-Iran blockade reports

Federal Reserve Chairman Jerome Powell is leading his final rate-setting meeting before Kevin Warsh, Trump's nominee, takes over the Fed helm. The key question is whether Powell will serve out his term as Fed governor through February 2028, which would determine if Trump can appoint another dovish FOMC member. Markets currently see only 13% odds of rate cuts this year amid elevated oil prices around $103 per barrel.

• At the March 18 meeting, Stephen Miran was the only FOMC member to dissent and favor a quarter-point rate cut; Miran would step down when Warsh joins
• Warsh has criticized Fed's data-dependent approach and $7 trillion balance sheet, advocating for focus on AI-driven productivity gains that could allow faster growth without inflation
• Warsh faces trade-off between lower rates and smaller balance sheet: reducing Fed asset holdings would increase market supply, potentially raising long-term Treasury yields and federal borrowing costs

The Federal Reserve is expected to hold interest rates steady today, with Chair Jerome Powell's press conference potentially his last before his term expires May 15. Meanwhile, the UAE shocked global energy markets by announcing its exit from OPEC and OPEC+ following Iranian attacks. Starbucks shares rose 5% after beating earnings expectations and raising its full-year outlook.

• The Fed decision comes at 2 p.m. ET, with Powell expected to strike a cautious tone on labor markets and inflation; the Senate Banking Committee votes today on his nominated successor Kevin Warsh
• The UAE, OPEC's third-largest producer behind Saudi Arabia and Iraq, is leaving the oil cartel this week after being targeted by missile and drone attacks from fellow OPEC member Iran
• Starbucks reported its second straight quarter of traffic growth driven by protein cold foam and bakery items, with CEO Brian Niccol calling it a 'milestone' and 'the turn in our turnaround'

Oil inventories at the UAE's Fujairah storage hub fell 6.3% week-on-week to 6.982 million barrels, marking the fourth consecutive record low and a 66% decline since conflict with Iran began. The supply strain has pushed Brent crude to $115 per barrel, its highest level since June 2022, amid escalating Middle East tensions.

• Heavy distillates used in marine fuel dropped 14% to 3.058 million barrels, hitting a third consecutive record low, while light distillates fell 2.7% to 2.680 million barrels
• Brent crude surged to $115 per barrel driven by Iranian threats to critical shipping lanes and U.S. pressure extending blockades on Iranian ports
• Inventories have plummeted from above 8 million barrels in early March, with traders positioning for prolonged volatility rather than quick de-escalation

Sberbank has revised Russia's 2026 GDP growth forecast downward to 0.5-1% from 1-1.5% following a challenging first quarter that saw the economy contract 1.8% in January and February. The downgrade reflects the impact of high interest rates, tax increases, a strong rouble, and weak oil prices before the Iran war began.

• Mining and manufacturing sectors were hit hardest, with significant slowdown in consumer spending affecting retail trade and construction sector stagnation in Q1
• Sberbank forecasts 2026 inflation at 6-6.5%, notably above the central bank's 4.5-5.5% prediction
• Deputy CEO Taras Skvortsov attributed the poor performance to 'tight monetary conditions' during the first quarter

US stock futures traded mixed on Wednesday as investors awaited major Big Tech earnings reports and the Federal Reserve's policy decision. Market sentiment was dampened by a report showing OpenAI missed internal growth targets, raising questions about AI monetization amid stretched tech valuations. The Fed is expected to hold rates steady, but investors will scrutinize Chair Powell's commentary for clues on future policy direction.

• OpenAI reportedly missed internal targets for weekly users and revenue, intensifying scrutiny over whether massive AI spending by tech giants is translating into actual commercial returns
• Robinhood fell 10% premarket after missing Q1 profit expectations, while NXP Semiconductors surged 16.1% on above-consensus Q2 revenue and profit guidance
• The Federal Reserve is widely expected to hold rates unchanged, but any hawkish shift in Powell's language on inflation or economic conditions could pressure equities and Treasury yields

London's FTSE 100 fell 0.7% on April 29, marking its seventh decline in eight sessions, as investors reacted cautiously to mixed corporate earnings and ongoing geopolitical uncertainty surrounding the U.S.-Iran war. Major companies including AstraZeneca, GSK, and Lloyds declined despite posting better-than-expected quarterly results.

• Blue-chip stocks declined despite strong earnings: AstraZeneca fell 1.4%, GSK dropped 2.1%, and Lloyds dipped 1.4%, all after beating profit expectations but maintaining existing forecasts
• Geopolitical tensions remain elevated as U.S.-Iran war negotiations stall, with President Trump rejecting Tehran's latest proposal, contributing to market caution ahead of the Federal Reserve meeting
• DCC surged 16% after announcing it is reviewing a cash acquisition offer from a consortium of U.S. investment firms Energy Capital Partners and KKR

Microsoft, Amazon, Alphabet, and Meta are set to report quarterly earnings on Wednesday, representing a critical test for the AI-driven stock market rally. The four hyperscalers collectively account for over $10 trillion in market cap and 17% of the S&P 500's weighting, with planned AI infrastructure spending exceeding $600 billion this year. Investors will scrutinize whether massive capital expenditures are translating into revenue growth, with implications for the broader AI sector including chip stocks.

• Capital spending among the four companies plus Oracle is expected to rise from 50% of operating cash flow in 2024 to nearly 90% by 2027, requiring proof that investments generate returns within the next few quarters
• Options markets are pricing in post-earnings stock price swings of 4% to 7.1%, with all four companies reporting simultaneously creating potential for heightened volatility across AI-related stocks
• The semiconductor index (SOX) has surged 40% this year and doubled over the past year on hyperscaler spending, making chip stocks particularly vulnerable to any signs of reduced AI infrastructure investment

Melrose Industries, owner of GKN Aerospace, reported an 11% increase in first-quarter revenue driven by strong performance in wide-body jets, engines, and military businesses. The company flagged inflationary pressure from higher freight costs amid Middle East tensions and expressed concern about potential impacts on civil flying hours from reduced jet fuel availability. Melrose maintained its 2026 revenue outlook of £3.75-3.95 billion despite near-term geopolitical uncertainties.

• First-quarter revenue jumped 11%, supported by wide-body aircraft, engines, and repairs/military segments, though the company faces freight cost inflation from Middle East conflict disruptions
• Melrose supplies Boeing and Airbus but has no operating footprint in the Middle East and minimal direct supply chain exposure to the region
• Company reiterated 2026 guidance of £3.75-3.95 billion revenue and £700-750 million adjusted operating profit, with analysts citing 'attractive structural growth story' despite geopolitical concerns

China's independent refiners continue importing Iranian oil despite intensified U.S. sanctions, but purchasing is slowing due to severely negative refining margins and rising Iranian crude prices. The U.S. imposed a full blockade on Iranian oil shipping on April 13 and sanctioned major Chinese refiner Hengli Petrochemical, though analysts expect Chinese buying patterns to persist as long as Iranian supply remains available.

• Chinese 'teapot' refiners buy roughly 90% of Iran's oil shipments, importing a record 1.8 million barrels per day in March, with at least 140-155 million barrels currently in transit to China
• Domestic refining margins have collapsed to negative $77.50 per metric ton (a one-year low) as government-regulated fuel prices lag crude cost increases from Middle East tensions
• Iranian Light crude has flipped from a discount to trading at parity or a small premium to ICE Brent for the first time, eroding demand from price-sensitive Chinese buyers

President Donald Trump threatened Iran via Truth Social with an AI-generated image of himself holding a gun, demanding the country 'get smart soon' on signing a non-nuclear deal. The post comes amid a blockaded Strait of Hormuz and stalled negotiations, with Trump canceling scheduled talks and rejecting Iran's latest proposal to reopen the strait in exchange for lifting U.S. port blockades.

• Trump posted the threatening message at 4 a.m. ET Wednesday with AI imagery showing explosions and text reading 'NO MORE MR. NICE GUY!'
• Negotiations remain deadlocked after Trump canceled a planned trip to Islamabad and rejected Tehran's proposal to postpone nuclear talks while reopening the Strait of Hormuz
• Oil futures rose sharply following the post, with WTI up 2.82% to $102.75 and Brent up 3% to $114.62, further complicated by UAE's announced exit from OPEC on May 1