April closed with the S&P 500's strongest monthly gain in six years, five straight weeks of advances, and an Iran deal that is close but not done. Three Fed officials dissented on rate policy. Oil fell to $102 on a fresh Tehran proposal. And Apple gave everyone the green light to stay long. Here is what happened and what to watch.
The week of 27 April to 2 May was, in one word, earnings. About 81% of S&P 500 companies beat first-quarter estimates. Microsoft, Alphabet, Meta, Amazon, and Apple all reported. The AI spending narrative held up. Consumer spending held up. Guidance held up. For investors who have spent four months worrying about a recession, the earnings season was the reality check they needed in the other direction.
The geopolitical thread ran underneath all of it. The US-Iran ceasefire held for another week. Tehran delivered a new proposal to Washington on Friday, and crude fell to $102 a barrel on the news. President Trump said Iran wants to make a deal but he is "not satisfied" with what's on the table. The market is reading this correctly: a deal is directionally positive, but the outcome is not yet certain. Every week the ceasefire holds is a week the oil risk premium bleeds out of asset prices.
Apple's results on Thursday evening were the moment that mattered most to sentiment. A solid outlook into the next quarter confirmed that consumer demand has not broken. The Nasdaq responded immediately and the week closed on a constructive note.
April's full-month numbers are worth stating plainly. The S&P 500 rose 10.4% and the Nasdaq 15.3% in April alone. That is the best monthly performance for US equities since 2020. It came despite the Iran war, despite elevated oil, despite a Fed that is not cutting rates. The earnings beat rate of 81% is what drove it.
The dollar was stable. The euro sat at $1.17. Sterling fell slightly. The yen weakened to 157 per dollar. None of these moved dramatically, which tells you the week was fundamentals-driven rather than macro-driven.
Three Federal Reserve officials dissented from this week's policy statement. Neel Kashkari (Minneapolis), Beth Hammack (Cleveland), and Lorie Logan (Dallas) all pushed back on the language that signalled the next rate move was likely to be a cut. Kashkari explicitly said the Fed should signal the next move could be either a cut or a hike. Hammack flagged oil prices adding to inflation pressure. Logan expressed concern about how long it will take to get back to the 2% target.
Markets largely brushed this off. The probability of a June cut is priced near zero regardless. What the dissent tells you is that the Fed's internal debate has shifted. The question is no longer "when do we cut?" It is "are we sure we don't need to hike again?" That is a meaningfully different conversation, and the bond market should be watching it more carefully than equities are.
The US manufacturing PMI for April showed continued expansion even as input prices rose sharply, driven by oil costs. A 7% of GDP deficit projection for 2026-27 from Fitch sits in the background. None of this is crisis-level. But it is not a clean macro picture.
Brent hit $126 a barrel mid-week on Hormuz supply fears before retreating sharply when Iran's proposal landed. It settled near $114 by week-end on the Brent curve, with WTI at $102. The gap between the two reflects the logistics disruption in the Strait rather than fundamental supply destruction.
For Indian investors, this number is the one that matters most. At $114 Brent, India's import bill rises materially. The rupee feels pressure. The current account deficit widens. The RBI has to choose between defending the rupee and keeping liquidity conditions supportive. At $102 WTI, things look meaningfully better. The direction of the Iran negotiation over the next two weeks will determine whether India gets a macro tailwind or faces a sustained headwind into summer.
Indian equities closed the week under pressure. The Nifty 50 failed to hold the 24,000 level. FII outflows in April reached Rs 44,000 crore, a substantial withdrawal that DIIs attempted to absorb for most of the month before turning net sellers themselves by Friday. The rupee came under pressure in the 93-94 range, driven by dollar demand from importers paying higher oil bills.
The one genuinely positive data point was Manufacturing PMI at 55.9, firmly in expansion territory. The real economy is not breaking. The financial market pressure is coming from external factors, not domestic weakness. That distinction matters when thinking about whether this is a dip to buy or a structural deterioration. At this stage, it reads more like the former.
The critical number to watch is 23,650 on the Nifty. That is the next meaningful support level. If it holds, the April correction looks like a retracement within an uptrend. If it breaks, the 200-day moving average comes into view and the conversation changes.
Beyond the Magnificent Seven, a few other corporate stories from the week are worth noting. Exxon Mobil and Chevron posted earnings beats driven by higher oil and gas prices, offsetting some production disruptions from the Iran war. That is the energy sector working as a hedge in your portfolio exactly as it should.
Estee Lauder announced plans to cut up to 3,000 more jobs and generate $200 million in savings. This is the consumer discretionary sector telling you that demand conditions at the premium end are not as strong as the aggregate consumer spending data suggests. Premium consumer goods companies are still working through the post-COVID demand normalisation.
Trump raised tariffs on EU cars and trucks to 25%, claiming the bloc had not fully complied with an existing trade agreement. This is a new front opening in global trade policy at a moment when markets are already managing the Iran risk. It did not move equities materially this week, but it is another variable in the macro picture for European companies with US exposure.
Monday 4 May, Indian markets reopen. Maharashtra Day holiday means the first session back absorbs a week of global moves. Expect the Nifty open to price in everything that happened between Thursday's close and Monday morning, including the Apple results and the Iran proposal news.
Monday and Tuesday, US ISM Manufacturing and Services PMIs. These are the first hard data points after the earnings season. If manufacturing is softening and services are holding, that is the Goldilocks read the market wants. If both weaken, the recession narrative gets another hearing.
Friday 8 May, US Non-Farm Payrolls. This is the week's most important number. The Fed's three dissenters have made clear they are watching the labour market and inflation simultaneously. A strong jobs number with rising wages gives the hawks more ammunition. A soft number opens the door to dovish language in June. The spread between these two outcomes is large enough to move bonds meaningfully.
India earnings in full swing. Over 200 companies report this week. Bajaj Finserv is the primary swing factor for Bank Nifty. IT sector results and guidance will be watched for any confirmation or denial of the AI-led revenue deflation narrative that HCL Tech introduced last month.
The Iran thread. Tehran's new proposal is on the table. Trump said he is not satisfied. Every headline on this moves oil by $3 to $5 in either direction. The most important variable for Indian markets this week is not domestic, it is the outcome of diplomatic conversations in Washington and Tehran.
RBI currency watch. If Brent stays above $110 this week, expect RBI intervention in the rupee market to defend the 94 level. That intervention uses forex reserves and tightens domestic liquidity. Watch for any statement from RBI on liquidity conditions.
April 2026 will go into the record books as one of the best months for US equities in years. It happened in the middle of a war, with oil elevated, with three Fed dissenters signalling the rate cut narrative is less clear than markets assume, and with a tariff escalation against Europe. The earnings beat rate of 81% is what overwhelmed all of that.
The structural question this raises is whether the market is right to look past the macro risks or whether the earnings season has created a false sense of security. AI capex is holding up. Consumer spending is holding up. But a US deficit at 7% of GDP, a Fed that may be done cutting, and oil that depends on a diplomatic outcome not yet secured are not trivial background risks.
For Indian investors, the week ahead is binary on oil. If the Iran deal progresses, crude falls, the rupee stabilises, and the Nifty can build a base. If negotiations stall or break down, the Rs 44,000 crore of April FII selling starts to look like a preview rather than a peak.
Stay positioned for both outcomes. The time to take concentrated bets on resolution is when resolution is confirmed, not anticipated.
Every Sunday. Markets, macro, and what it means for your money.
No spam. Unsubscribe anytime. Powered by Mailchimp.