Section 01
The S&P 500 gained 9.67% in April — one of its strongest monthly performances in years and a near-complete reversal of March's geopolitical-driven losses. The recovery was broad-based, with most sectors participating as three powerful tailwinds converged: a partial ceasefire in the Iran conflict, a historically strong Q1 earnings season, and clarity from the Federal Reserve on near-term monetary policy.
Investor bearish sentiment fell from above 50% in March to approximately 34% in April — a dramatic shift in a single month. At the peak of fear, more than half of individual investors expected the market to decline. The rally happened anyway, faster than almost anyone expected. This is the documented pattern of how markets work.
📊 March vs. April 2026 — Side by Side
| Metric | March 2026 | April 2026 |
|---|---|---|
| S&P 500 Monthly Return | –5.1% | +9.67% |
| Brent Crude (Month-End) | ~$92/bbl | ~$85–90/bbl |
| Strait of Hormuz | Effectively closed | Partially reopened |
| Investor Bearish Sentiment | 50%+ | ~34% |
| Q1 Earnings Growth | Season not yet begun | +15.1% blended |
| Market Mood | Fear / Volatility | Recovery / Cautious Optimism |
Sources: Amsflow, AAII Investor Sentiment Survey, FactSet, CNBC. Past performance is not indicative of future results.
📊 Q1 2026 Earnings Growth by Sector — Year-over-Year (Blended)
Source: FactSet Earnings Insight, April 24, 2026. Past performance is not indicative of future results.
84% of reporting companies beat EPS estimates — above the 5-year average of 78% and the 10-year average of 76%.
Companies reported earnings 12.3% above estimates on average — more than double the historical norm of 7.1%.
The blended Q1 earnings growth rate of +15.1% marks the sixth consecutive quarter of double-digit year-over-year growth.
The S&P 500's blended net profit margin of 13.4% is the highest on record since FactSet began tracking this metric in 2009. Even through an oil shock and geopolitical war, American companies protected and grew their profitability.
📈 Forward Earnings Growth Forecast — S&P 500 (Analyst Consensus)
Source: FactSet Earnings Insight, April 24, 2026. Estimates are analyst consensus and subject to revision. Past performance is not indicative of future results.
"While short-term market behavior can be driven by many factors, long-term performance is mostly determined by earnings growth. The growth narrative is still very much intact."
— The Motley Fool, April 27, 2026Section 02
April brought meaningful — if fragile — progress on the geopolitical front. A two-week ceasefire, announced on April 8th, included a partial reopening of the Strait of Hormuz to commercial shipping. The result was an immediate easing of oil prices, a sharp equity market rally, and a modest improvement in the inflation outlook.
🗓 Key Events — April 2026: Iran Conflict & Strait of Hormuz
📈 Brent Crude Oil Price — Full Journey Since Conflict Began ($/barrel, approximate)
Source: IEA Oil Market Report, CNBC, Wikipedia 2026 Strait of Hormuz Crisis. Approximate values. Past performance is not indicative of future results.
📋 Brent Crude Milestones — March Through April 2026
| Date | Price | Key Development | Change |
|---|---|---|---|
| March 1 | ~$73/bbl | Pre-conflict baseline | Baseline |
| March 8 | $100+/bbl | First time above $100 in four years | +37% |
| Mid-March | $126/bbl 🔺 | Peak; gas crosses $4/gallon in U.S. | +73% |
| March 31 | ~$92/bbl | Eased on ceasefire signals | +26% |
| April 8 | Sharp drop | Ceasefire & Strait reopening announced | ↓ significant |
| April 30 | ~$85–90/bbl | Month-end; ceasefire expired, situation fluid | +$15–17 vs. start |
Source: IEA, CNBC, Wikipedia 2026 Iran War Fuel Crisis. Past performance is not indicative of future results.
Independent energy analyst Rory Johnston noted that any full reopening of the Strait would likely trigger an immediate $10–$20 drop in crude prices due to speculative positioning. However, supply chain bottlenecks, infrastructure damage, and lingering production outages would likely keep Brent anchored in the $80–$90 range rather than returning to pre-conflict levels in the near term.
The IEA's April Oil Market Report forecasts that a resumption of regular Gulf deliveries by mid-year is its base case — while acknowledging significant downside risk if the conflict re-escalates. The ceasefire expired April 30 with no extension. The situation entering May is materially more uncertain than it was two weeks ago.
Section 03
On April 29th, the Federal Reserve held its benchmark interest rate steady at 3.50–3.75% for the third consecutive meeting — in what was almost certainly Jerome Powell's final FOMC meeting as Chair. Kevin Warsh is scheduled to succeed him in mid-May.
The vote was historically divided — 8 to 4 — the first time four officials dissented in a single FOMC decision since October 1992. In his final press conference, Powell cited "elevated inflation, in part reflecting the recent increase in global energy prices," and "a high level of uncertainty" stemming from Middle East developments as the primary drivers of the continued pause.
📊 Federal Funds Rate — Journey from Peak to Present
Source: Federal Reserve, Trading Economics, Advisor Perspectives. April 29, 2026.
Markets are now pricing in zero rate cuts for the remainder of 2026 and well into 2027 — a significant shift from the one-to-two cuts expected at the start of the year. The incoming Fed Chair, Kevin Warsh, takes over mid-May. While he has not signaled aggressive policy shifts, his early remarks will be closely watched by markets for any signal on the rate path from a deeply divided committee.
Section 04
Earnings: All 11 S&P 500 sectors reported year-over-year revenue growth in Q1. The earnings story is broad, not concentrated in a handful of companies. Analyst consensus for full-year 2026 earnings growth stands at +18.6%, with acceleration expected in Q2–Q4.
Valuations — a note of caution: The S&P 500's forward P/E of 20.9× is above its 5-year average of 19.9× and its 10-year average of 18.9×. More notably, the CAPE ratio reached 40.1 — a level not seen since 1999. This is not a short-term trading signal. It is a long-term planning consideration. Historically, starting at CAPE levels this elevated has been associated with below-average returns over subsequent decades. Strong near-term earnings growth can justify elevated valuations — but this metric warrants ongoing monitoring.
Year-End Outlook: The Wall Street median year-end S&P 500 target remains approximately 7,650 — implying meaningful upside from current levels. Structural tailwinds including AI-driven productivity, earnings growth, and potential Federal Reserve easing remain intact.
Section 05
The following is provided for informational context only and does not represent a forecast or prediction of market performance.
Section 06
In our March commentary, we wrote that geopolitical supply disruptions, however severe, have historically been temporary — and that long-term investors who stay the course are rewarded. April did not disprove that thesis. It confirmed it, in real time, over 60 days.
Investors who moved to cash at the peak of March's fear didn't just miss April's rally. They locked in losses and then faced the question with no good answer: when do I get back in? No one rings a bell at the bottom.
📊 The Cost of Leaving: S&P 500 10-Year Returns — Staying Invested vs. Missing Best Days
Illustrative only. Based on approximate S&P 500 total return data 2006–2026. Past performance is not indicative of future results. You cannot invest directly in an index.
Research consistently shows that missing just the 10 best trading days over a 10-year period reduces total returns by approximately half. Many of those best days — like the ones in April — come immediately after the worst of the fear. You cannot time around them. You have to be there.
The months ahead will bring more uncertainty. The ceasefire has expired. A new Fed Chair is taking over. Valuations are elevated. None of these facts changes the fundamental purpose of a well-constructed financial plan: to provide a framework for navigating uncertainty — not eliminating it.
If you have questions about your financial plan, your current allocation, or how the events of recent months relate to your individual circumstances, we encourage you to reach out to us directly. That conversation is what this relationship is built for.