Project Freedom puts warships in the Strait starting today. Futures are pointing lower. And 121 S&P 500 companies report this week.
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The U.S. military begins escorting stranded commercial ships through the Strait of Hormuz today under a new operation involving destroyers, more than 100 aircraft, and 15,000 service members. The stated objective is extracting civilian vessels from neutral countries that have been trapped since the Strait effectively closed. Futures are pointing moderately lower this morning as markets price in the risk that extraction becomes escalation.
What matters:
Brent crude is trading around $109 this morning, ticking higher despite the stated goal of reopening shipping lanes. WTI is near $103.
The S&P 500 closed Friday at a record 7,230.12 after its strongest month since 2020. The Nasdaq finished at 25,114.44, also a record.
Palantir (PLTR) reports Q1 earnings after the close today with consensus near $0.28 in EPS, up 115% year over year, on revenue of roughly $1.54 billion.
The April jobs report lands Friday with consensus near 50,000 new positions, down sharply from March's 178,000.
The oil reaction tells you the market doesn't believe this ends cleanly.
If traders thought today's escort operation would begin restoring Strait transit, Brent would be falling. Instead it ticked higher. Brent has held above $100 since the Strait closed, and the new operation puts military assets alongside commercial vessels in a waterway where mines have been laid and ships have been fired on.
The scenarios are binary: either this begins a gradual reopening of roughly 20% of global oil transit, or it creates an incident that sends crude back toward the $126 intraday spike from last week. Neither outcome is fully priced.
For energy positioning, that binary favors domestic producers with no exposure to Middle East shipping routes. Devon Energy (DVN) produces primarily from the Permian, Delaware, and Anadarko basins with zero international operations. Diamondback Energy (FANG) runs a pure Permian footprint. Both benefit from elevated crude without carrying tanker-route risk.
Brent has pulled back from last week's $126 peak to around $109 today. If the escort operation proceeds without incident, that pullback could extend. If it doesn't, the energy complex reprices higher from an already elevated base.
This is the heaviest earnings week of the season, and it starts tonight.
Roughly 121 S&P 500 companies report over the next five days. Palantir is the first significant name, with Q1 results after the close. Revenue is expected at $1.54 billion, up 74% year over year, with government revenue growing roughly 57% and commercial revenue surging an estimated 94%. The commercial acceleration, driven by adoption of Palantir's AI Platform for enterprise customers, is the number the market cares most about. Options are pricing a move of roughly 10% in either direction.
AMD follows Tuesday with expected EPS around $1.29 on roughly $9.9 billion in revenue, up about 33%. The data center segment is the line to watch. AMD's EPYC server processors and Instinct AI accelerators are taking market share from Intel at a pace that has the data center business on track to rival Intel's most profitable division.
Disney (DIS) reports midweek. Uber and Airbnb (ABNB) follow later in the week, both offering real-time reads on whether discretionary consumer spending is surviving $109 oil and 4.5% PCE inflation.
Friday's jobs report could reshape the rate outlook.
Consensus expects roughly 50,000 new positions in April, down from 178,000 in March. The March figure itself was a rebound from February's strike-distorted decline of 133,000. If April prints below expectations, the labor market is weakening at exactly the moment oil-driven inflation makes rate cuts nearly impossible.
JPMorgan's economists have staked out the most hawkish position on the Street: no cuts for the rest of 2026, with the next move a 25 basis point hike in Q3 2027. The unemployment rate is expected to hold at 4.3%.
The Asian session confirmed the AI trade still has momentum.
South Korea's Kospi surged roughly 5% on Monday. Samsung Electronics and SK Hynix both hit record intraday highs on demand for high-bandwidth memory chips used in AI data centers. Micron (MU), the closest U.S.-listed competitor in HBM production, trades into the same pricing tailwind where AI infrastructure spending is outrunning chip supply.
Where things stand.
The S&P 500 closed Friday at 7,230.12. The Nasdaq finished at 25,114.44. The Dow slipped to 49,499.27. April delivered the S&P's best month since 2020 with a 10.4% gain. The Nasdaq added 15.3%.
Gold is trading around $4,600. Bitcoin is near $79,000. The 10-year Treasury yield is around 4.35%.
The market spent last week celebrating earnings at record highs. This week, a military operation in the Strait, the heaviest earnings slate of the season, and a jobs number that could close the door on rate cuts all land in the same five days.
More tomorrow.