Morning in New York: geopolitics pressures - reporting supports

Daily review and forecast of events on the U.S. stock market from Mikhail Denislamov, Deputy Director of Capital Markets Research, Freedom Broker.

Today is the expiration of the statutory deadline for the US President to either end the military operation or address Congress to justify its continuation under the 1973 War Powers Resolution. In this context, the foreign policy agenda remains the key pressure on the markets. Iran has declared its readiness to launch "prolonged and painful strikes" against US positions in the event of renewed American attacks. In turn, Washington seeks to engage its allies in securing shipping in the region. In our view, the likelihood of continued conflict remains high, which supports the risk premium in energy prices. WTI oil is balancing around $105 per barrel.

Corporate reporting remains another important factor for stock exchange dynamics. The flow of releases exceeding expectations continues to form a positive background for the U.S. stock market, leveling out concerns related to expensive oil.

In the macroeconomic calendar, the releases of S&P Global (revised estimate) and ISM business activity indexes (PMI) in the manufacturing sector for April are of the greatest interest. The consensus for the first indicator suggests that it will remain at 54 points, while the second indicator is expected to rise from 52.7 points to 53.2 points. The coincidence of the actual indicators with the expected ones will confirm the trend of expansion of business activity in manufacturing and the stability of the U.S. economy after the strong consumer spending data published the day before.

Quarterly reports were published by Exxon Mobil (XOM), Chevron (CVX ), The Estée Lauder Companies (EL), Linde (LIN). Colgate-Palmolive (CL), Moderna (MRNA ) and Dominion Energy (D) will also report before the opening of the main session.

Futures on American stock indices demonstrate about zero dynamics. We assess the balance of risks for the upcoming session as neutral with average volatility.

- Shares of Apple (AAPL) are up about 3% after the release of quarterly earnings and the announcement of a $100 billion buyback. The company's revenue increased by $111.18 billion against the consensus of $109.66 billion, and earnings per share reached $2.01 with average expectations of $1.95. iPhone sales totaled $56.99 billion, falling slightly short of forecasts due to chip supply constraints, but revenue from MacBook Neo and service segment sales offset this negative. The company's own guidance for the current quarter assumes revenue growth of 14-17% with the consensus of about 9.5%.

- Strong quarterly results drove Atlassian's (TEAM) stock price up 24%. The company's revenue in the third quarter of fiscal 2026 climbed 32% YoY to $1.79 billion, exceeding market expectations. Cloud segment revenue increased 29% to $1.13 billion and adjusted EPS was $1.75. Management sees no signs of weakening demand for user licenses due to the impact of AI and notes active growth in the number of contracts and cross-sales between product lines.

- Twilio (TWLO) shares are adding nearly 20% as it reported quarterly revenue up 20% YoY to $1.41 billion with consensus near $1.34 billion, as well as adjusted EPS of $1.5 with an average guidance of $1.27. In addition, the company's own revenue growth guideline for 2026 was raised to 14-15% from 11.5-12.5%.

- Reddit (RDDT) stock is up more than 15% as the company for the first quarter reported a 69% YoY increase in revenue to $663 million, with EPS of $1.01, while the consensus was projecting results of $611 million and $0.58, respectively. The company raised its own revenue guidance for the current quarter to $715-725 mln, with the average market forecasts of $712 mln.

- The revision of the platform segment revenue forecast for the current year from $4.89 bln to $5 bln led to a jump in Roku (ROKU) quotations by almost 8%. For the first quarter, this figure increased by 28% YoY to $1.13 bln, while the consensus was $1.01 bln. Management notes steady growth in demand from advertisers in the connected TV segment.

- Shares of Roblox (RBLX) collapsed more than 20% after the company lowered its 2026 user payment volume forecast from $8.28-8.55 billion to $7.33-7.6 billion. The basis for the deterioration of the benchmark was the introduction of new security measures, which, according to management, could negatively affect the growth rate of the service's audience and its spending.

Trading on April 30 on the U.S. stock exchanges was in the green zone. S&P 500 and Nasdaq 100 renewed historical maximums at the closing, rising by 1.02% and 0.98%, respectively. The Dow Jones added 1.62%, and the Russell 2000 rose 2.21% amid strong demand for small-cap stocks. The equal-weighted S&P 500 outperformed the "classic" index by about 50 bps, reflecting the broad-based nature of the rally.

All sectors of the S&P 500 ended the day in the plus. The industrial sector (XLI: +2.74%) became the leader of growth with the support of equipment manufacturers, as well as construction and infrastructure companies. The technology sector (XLK: +0.22%) showed the most modest growth due to the mixed reaction of investors to the reports of major IT companies.

Shares of the "Magnificent Seven" traded in mixed directions. Alphabet (GOOGL: +9.96% at the close of trading on April 30) looked much stronger than the market, which recorded in its report a strong growth in revenue from cloud business and raised its forecast of demand for AI infrastructure. Meanwhile, shares of Meta Platforms (META: -8.55%) and Microsoft (MSFT: -3.93%) were under pressure due to cautious guidances and further increases in capital expenditures.

Strong corporate reporting was again a key support for the market. Investors were positive on continued strong demand for computing power and infrastructure for artificial intelligence, which continues to support semiconductor manufacturers and related companies. However, shares of Nvidia (NVDA: -4.63%) were among the outsiders due to fears of increased competition from custom chips from Alphabet and Amazon.

Macroeconomic statistics generally confirmed the resilience of the US economy. U.S. GDP in the first quarter grew by 2% on an annualized basis at a consensus of 2.3%. Personal income in Ma increased by 0.6% mom after zero growth a month earlier, consumer spending rose by 0.9% mom, and the core PCE index added 0.3% mom, matching market expectations. The number of initial jobless claims fell to the lowest since 1969 at 189 thousand.

WTI crude oil corrected by 1.7% after rising by almost 7% a day earlier, but tensions in the Middle East remain in the focus of investors' attention. Risks of supply disruptions through the Strait of Hormuz remain, despite the absence of conflict escalation. Against this background, gold rose by 1.5%, silver added 2.7%, and the dollar index showed its worst daily performance in more than a year.

-Eli Lilly (LLY: +9.8% at the close of trading on April 30) reported quarterly revenue and earnings above average market expectations, driven by strong sales volumes of Mounjaro and Zepbound. Management raised its outlook for 2026, citing strong demand for weight loss products both in the U.S. and internationally.

- Caterpillar's (CAT: +9.9%) quarterly results significantly exceeded consensus thanks to a 52% YoY increase in orders, strong demand for construction and power generation equipment, and positive revenue momentum from the data center infrastructure segment. Management revised upward its revenue and free cash flow guidance for 2026.

- Carrier Global's (CARR: +8.8%) order intake for the most recent reporting period increased 11%, with profit and revenue beating average expectations. The main growth driver was the commercial HVAC segment, where demand from data centers more than quintupled. The company left its full-year forecast unchanged despite macroeconomic uncertainty.

- Strong revenue and earnings growth driven by the Electric Infrastructure Solutions division allowed Quanta Services (PWR: +15.8%) to revise upward the guideline for 2026. Backlog reached a record level, management noted strong demand from energy infrastructure and projects related to AI and data center development.

- Despite quarterly earnings and revenue above market expectations, Mastercard (MA: -4.3%) shares came under pressure due to signs of slowing growth in cross-border payments and management's cautious comments on international travel. Investors also negatively perceived the risks of weakening consumer activity in the second quarter.

-Royal Caribbean Group (RCL: +3.8%) reported results better than the most cautious forecasts, despite a decline in full-year guideway. The company noted an improvement in bookings in April and a recovery in cruise demand after a temporary downturn caused by the conflict in the Middle East and a spike in fuel prices.

This article was AI-translated and verified by a human editor