Key Highlights

  • Iran fired cruise missiles and drones at the UAE on Monday, the first attacks since the April 8 ceasefire; U.S. CENTCOM sank six small Iranian boats in the Strait of Hormuz
  • UAE schools shifted to remote learning Tuesday through Friday; four missile alerts issued; fires reported at Fujairah oil facilities
  • Trump warned Iran will be "blown off the face of the earth" if it targets U.S. ships, but stopped short of declaring the ceasefire violated
  • S&P 500 fell 0.41%, Dow shed 557 points on Monday; WTI now at USD 100.58, Brent at USD 110.42; 10-year yield rising toward 4.45-4.46%
  • AMD and Arista Networks headline the after-bell earnings slate; Pfizer, KKR, and PayPal report before the open

Market Snapshot

U.S. equity futures are higher in early Tuesday trading. S&P 500 E-mini futures are up 0.34% at 7,254.50, Nasdaq 100 E-mini futures up 0.54% at 27,926.25, and Dow E-mini futures up 0.28% at 49,216, partially recovering Monday's losses when the S&P closed down 0.41% at 7,200.75 and the Dow shed 557 points to 48,941.90. WTI crude is at USD 100.575, down 1.50%, and Brent at USD 110.415, down 1.38%, pulling back from Monday's highs as initial ceasefire fears partially ease. Natural gas is down 1.29% at USD 2.9464. Gold spot is up 0.65% at USD 4,553.36 and silver up 1.23% at USD 73.621, with precious metals holding safe-haven bids from the Hormuz escalation. The VIX stands at 18.29, up 7.65% on the session, elevated but not signalling panic.

Macro Context

Monday's session was defined by one event: Iran breaking the ceasefire. The UAE intercepted cruise missiles and drones in the first attacks since April 8, with fires reported at Fujairah, a key oil export terminal outside the Strait of Hormuz specifically designed to bypass it. U.S. CENTCOM sank six small Iranian boats during a contested passage operation. Trump warned Iran in the strongest terms yet but avoided declaring the ceasefire dead. Saudi Arabia called for de-escalation. The Strait of Hormuz remains effectively closed to commercial traffic.

The market impact was asymmetric: energy stocks were the only S&P sector to close in the green (+0.6%), while the Dow posted its largest single-day loss in weeks. The 30-year Treasury yield broke above 5.03% intraday, the highest since mid-2025, as markets repriced the duration of elevated energy inflation. The 10-year yield is testing 4.45-4.46%, a region it has not sustained since the post-FOMC spike last week. With Warsh not yet confirmed by the full Senate, the Fed enters the week with a fractured committee and no policy flexibility as the energy shock reasserts itself.

Tuesday's domestic data calendar is second-tier relative to last week's GDP/PCE cluster but directionally important: ISM Services and JOLTS job openings at 10:00 a.m. ET will either reinforce or soften the stagflationary read. Two Fed speakers, Bowman at 10:00 a.m. and Barr at 12:30 p.m., give the committee its first public opportunity to address Monday's escalation.

Economic Data

8:30 a.m. ET: U.S. Trade Balance, March Consensus: -USD 60.9B · Prior: -USD 57.3B · A wider deficit consistent with front-loading of imports ahead of tariffs. The directional story matters less than whether the number confirms the inventory-build dynamic that flattered Q1 GDP.

9:45 a.m. ET: S&P Final U.S. Services PMI, April Prior: 51.3 · Final read; flash was already out. Watch for any material revision. Services holding above 50 keeps the dual-mandate bind intact.

10:00 a.m. ET: ISM Services, April Consensus: 54.3% · Prior: 54.0% · The session's most market-moving domestic print. A beat confirms services-sector resilience and removes any near-term argument for cuts. A miss below 52 complicates the picture.

10:00 a.m. ET: Job Openings (JOLTS), March Consensus: 6.8 million · Prior: 6.9 million · Labour demand is moderating but not cracking. Any print below 6.5 million activates the demand-destruction narrative; above 7.0 million reinstates the wage-pressure concern.

10:00 a.m. ET: New Home Sales, February (delayed) & March Feb consensus: 631,000 · Feb prior: 587,000 · March consensus: 660,000 · Housing data is a lagging signal at this rate level. The sequential gap between the two prints matters more than either in isolation, telling you whether the March rate spike has bitten yet.

10:00 a.m. ET: Fed Vice Chair Bowman speech First Fed public comments since Monday's Hormuz escalation. Any signal on the Fed's reaction function to an energy-driven inflation resurgence is the operative market-mover.

12:30 p.m. ET: Fed Governor Barr speech Second opportunity for Fed commentary. Barr has been on the hawkish-leaning side of the committee; consistency with Bowman or divergence from it sets the tone for the week.

Earnings: Before the Bell

Pfizer (NYSE:PFE) EPS consensus USD 0.73 against a year-ago USD 0.92, on revenue of USD 13.89B. The year-on-year EPS decline is expected as the COVID product tailwind fully fades. The operative question is whether the core portfolio (Paxlovid, Vyndaqel, Eliquis) holds the revenue line steady. Any full-year guidance revision on oncology pipeline progress or manufacturing cost savings is the stock-moving variable.

PayPal (NASDAQ:PYPL) EPS consensus USD 1.27 against a year-ago USD 1.33, on revenue of USD 8.06B. The declining EPS sets a low bar, but the market is focused on branded checkout volume growth and take-rate trajectory. Venmo monetisation progress and any upward revision to transaction margin guidance is the catalyst. A second consecutive miss here would deepen concerns about competitive pressure from Apple Pay and Block.

Earnings: After the Bell

Advanced Micro Devices (NASDAQ:AMD) EPS consensus USD 1.27 against a year-ago USD 0.96, on revenue of USD 9.84B. The session's highest-stakes report. Data centre GPU revenue, specifically the MI300X ramp and the competitive read against Nvidia, is the sole variable the market is pricing. Revenue consensus at USD 9.84B against a USD 7.44B prior implies 32% year-on-year growth; any acceleration in that figure, or upward Q2 guidance, is a catalyst for the broader semiconductor complex. Client and gaming segments are noise. The risk: AMD's hyperscaler customer concentration means prior earnings calls have already pre-shaped the print.

Arista Networks (NYSE:ANET) EPS consensus USD 0.81 against a year-ago USD 0.65, on revenue of USD 2.62B. A direct-play on hyperscaler networking capex, the same spend cycle that drove Alphabet and Amazon's beats last week. Consensus implies 30%+ revenue growth. Forward order visibility and backlog commentary are the operative signals; any softness here is a leading indicator for the broader AI infrastructure capex cycle.

One Number to Watch

54.3% is the ISM Services consensus for April. A print at or above that level confirms the services sector is absorbing elevated energy costs without demand destruction, removing any near-term argument for a Fed cut and supporting the higher-for-longer rate path. A print below 52.0%, arriving on the same morning as oil elevated and yields at multi-month highs, produces the services-side of the stagflationary read that last week's GDP miss and PCE beat first outlined. That scenario hands AMD and Arista's conference calls a materially more complicated macro backdrop than the AI-capex optimism currently priced into both stocks.