CWS Market Review – April 14, 2026

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In normal markets, traders keep their eyes on boring but important things like earnings, interest rates, industrial production and manufacturing.

Not anymore! In this market, the main drivers are things like ceasefires, the Strait of Hormuz and anything from Truth Social. Indeed, one tweet from the Commander in Chief can send the markets reeling, in any direction.

Lately, I’m pleased to say that it’s been good news that’s moving the market. To be very blunt, the stock market is chilling out in a major way. Only a few days ago, traders were scared witless.

On Tuesday, the S&P 500 closed higher for the ninth time in the last ten days. The index is now above both its 50- and 200-day moving averages. In fact, we’re not too far from a new all-time high. Everything we lost during the war has been made back.

I should also note that the recent shift has been strongly tilted towards growth stocks. Over the last 10 days, growth has outgained value eight times. That’s a revealing stat. It suggests that the fear investors had is starting to wane.

The stock market was helped by President Trump saying that the Iranians want to talk. As Churchill said, it’s better to jaw-jaw than to war-war. The S&P 500 closed Tuesday at its highest level since hostilities began. It’s possible that talks may resume before the ceasefire ends.

Q1 Earnings Season Is Underway

We’re also starting to get earnings reports for the Q1 earnings season. On Monday, Goldman Sachs (GS) got the ball rolling. The big Wall Street bank said it made $17.55 per share which bested Wall Street’s forecast for $16.49 per share.

Despite the earnings beat, some of the details were disappointing. For example, income from Goldman’s fixed income, currency and credit products fell by 10%. On the plus side, Goldman’s investment banking fees rose by 48% to $2.84 billion. That was over $300 million more than expected.

Overall profits were up 19% to $5.63 billion. Shares of Goldman pulled back after the report, but the stock has been a pretty good performer over the last few years.

BlackRock (BLK), the ETF behemoth, said that its quarterly profits were up 46% over last year. For Q1, BlackRock made $2.2 billion. At the end of March, the company managed $13.89 trillion in assets. That’s actually down a tad since the start of the year.

For Q1, BlackRock made $12.53 per share which topped estimates of $11.65 per share. The stock rallied 3% on Tuesday.

Citigroup (C) also had a very impressive Q1. On Tuesday, the big bank said it made $3.06 per share for its Q1. That was above consensus for $2.65 per share. Citi made $1.96 per share for last year’s Q1. Revenue was $24.63 billion which was more than estimates of $23.55 billion.

The bank has been paring back on its operations in an attempt to make itself leaner. So far, Wall Street appears to approve. Citi has been the best performer of the major banks on Wall Street. Since the beginning of 2024, shares of Citi are up 170%.

Not all the companies that reported on Tuesday were banks. Johnson & Johnson (JNJ) also reported Q1 results. For the quarter, JNJ’s revenue rose nearly 10% to $24.1 billion. Earnings were $2.70 per share which was four cents above consensus. Like Goldman and JPMorgan, Johnson & Johnson is a member of the Dow Jones Industrial Average.

Johnson and Johnson had a super block-buster drug with Stelara. At one point it was brining over $10 billion in annual sales, but now it’s lost its patent protection and it faces competition. Sales of Stelara fell by 60%. JNJ also raised its full-year revenue estimates by a little bit. Since July, the stock is up over 55%.

Energy Prices Soared Last Month

There’s been a lot of debate about Operation Epic Fury and its impact on the economy. For a long time, there’s been a lot of guessing but little in the way of hard evidence. We finally got a clue on Friday when the government released the inflation report for March.

For March, the CPI increased by 0.9%. Not surprisingly, that was helped by a 10.9% jump in energy prices, and gasoline prices were up by 21.2%. Over the last year, the CPI is up by 3.3%.

If we look past oil, then inflation isn’t so bad. For March, the core rate of inflation rose by just 0.2%. That was 0.1% less than forecast. Over the last year, the core rate is up by just 2.6%.

Here are some more details:

Services excluding energy rose 0.2% for the month and were up 3% from a year ago. Similarly, shelter was up 0.3% monthly and 3% annually, tied for its lowest level since August 2021.

Food prices were unchanged for the month and up 2.7% annually, with food at home falling 0.2%. Meat prices declined 0.6% while eggs fell another 3.4% and have tumbled 44.7% over the past year. New vehicle prices rose just 0.1%.

There were some signs of tariff and war impacts: airline fares jumped 2.7% while apparel climbed 1%.

The surge in the CPI meant that real earnings for workers decreased 0.6% for the month, as average hourly earnings rose just 0.2%. For the 12-month period, real average hourly earnings increased 0.3%.

The Federal Reserve meets again in another two weeks, and once again, I think we can dismiss any plans for a rate cut. In fact, I think it’s very doubtful that the Fed will make any changes to interest rates before the end of the year. According to futures traders, the earliest possible rate cut won’t be for another 14 months. That would bring us close to the middle of next year.

Wall Street is very concerned about rising energy prices, but it apparently thinks that won’t last. Next month, Kevin Warsh is due to take over as Fed Chair. By the way, we learned today from Mr. Warsh’s financial disclosure forms that he’s worth at least $135 million.

One concern is that the U.S. economy could find itself in “stagflation.” That’s when the economy weakens but prices rise, which is what we had in the late 1970s.

The problem with stagflation is that it puts the Fed in a tight spot. The economy needs lower rates in order to grow, but it needs higher rates in order to stave off inflation. In the early 1980s, the Fed raised rates to the ceiling. Interest rates came close to 20%. The economy faced a brutal recession, but it finally cleansed the economy of inflation.

That’s all for now. This week will mostly be about Q1 earnings and any news of ceasefire talks. I’ll have more for you in the next issue of CWS Market Review.

– Eddy

Posted by on April 14th, 2026 at 7:30 pm


The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.