🔹 Records Up Top. Domino's Underneath

Good afternoon,

The S&P 500 closed Monday at another record. Domino's closed it down 8% with a warning that the consumer is tiring. Both things happened in the same session, and both are true. Oil is back above $108, the 10-year is at a two-week high, and only three of eleven sectors managed to rise.

With the Bank of Japan already lifting its inflation forecast, the Fed deciding Wednesday in what may be Powell's last meeting, and four of the Magnificent Seven reporting on a single evening, this is the week the rally finally has to show its work.

The Pulse

The S&P 500 finished Monday at a record 7,173.9, up 0.12%. The Nasdaq added 0.20% to a fresh high of 24,887. The 10-year Treasury yield closed at 4.34%, a two-week high.

Markets

• Only 3 of 11 S&P sectors rose Monday: tech, communications, and financials. The Philadelphia Semiconductor Index broke a 19-session winning streak.
• Nvidia rose about 4% to $212, retaking the $5 trillion market cap level; Micron added 5.6% on continued AI demand.
• Just 53% of S&P 500 stocks now trade above their 50-day moving average, down from 60% a week ago, with the index RSI near 70 and the chip RSI above 80.
• Treasury yields rose 2 to 3 basis points across the curve as auctions drew mixed demand and traders fully erased remaining 2026 Fed rate-cut bets.

The headline indices look strong, but a thinner roster of names is doing the lifting. Wednesday evening tells us whether the AI capex story can broaden the rally, or whether narrowness becomes the story.

Earnings

• Verizon led the morning. The company posted Q1 adjusted EPS of $1.28, beating the $1.21 consensus by 5.8%, on revenue of $34.4 billion. More importantly, Verizon added 55,000 postpaid phone subscribers, its first positive first quarter on that metric since 2013, against expectations of an 88,000 loss. Management raised 2026 adjusted EPS guidance to growth of 5% to 6%, and shares closed up 3.5%.
• Domino's was the cautionary tale. Q1 EPS of $4.13 missed the $4.28 consensus, revenue of $1.15 billion missed the $1.17 billion estimate, and US same-store sales grew just 0.9% against the 2.6% Wall Street wanted. The company lowered its 2026 outlook, and shares closed down more than 8%. CEO Russell Weiner said he expects more fast-food chains to report similar consumer pressure.

This week's lineup:

• Today: Visa, Spotify, Coca-Cola, Ford, Hilton
• Wednesday: Microsoft, Amazon, Meta, Qualcomm, Chipotle 
• Thursday: Apple, Reddit, Mastercard, Sandisk
• Friday: ExxonMobil, Chevron

Earnings season tells you which public companies are working. The bigger story for the next twelve months may be what hasn't gone public yet.

Gold & Silver Moves

Gold settled near $4,682 an ounce Monday, slightly lower on the day, then drifted back toward $4,700 on Tuesday morning as Iran's latest proposal added a small bid.

The drivers are familiar. Brent above $108 keeps near-term inflation expectations sticky, which keeps the dollar firmer than gold bulls would like. The structural support has not weakened in any meaningful way. Reuters' latest analyst poll lifted the 2026 median gold forecast again, and Deutsche Bank flagged that gold's share of central bank reserves has tripled in recent years, with dollar exposure pulling back at the margins.

This is what a healthy consolidation looks like. The crowded trade is exhaling. The structural bid is intact.

Silver is trading near $76 an ounce, slightly lower on the day and a touch weaker than gold on a relative basis. On a one-month view, silver is still ahead.

Silver continues to do two jobs at once. It tracks gold as a monetary hedge, and it answers to industrial demand from solar, EVs, batteries, and AI infrastructure. CATL's $5 billion Hong Kong placement this week, raised to fund global battery and zero-carbon expansion, is a reminder that the industrial bid for silver is structural, not seasonal.

The Gold / Silver ratio sits at 62.98, a small drift higher from Friday. The move is worth noting in direction, not magnitude. The ratio rose because silver gave back a bit more than gold did Monday, the textbook short-term pattern when the dollar firms and risk appetite cools at the margins.

Historical context is what matters here. The modern ratio has spent most of the last forty years between 50 and 80. It spiked toward triple digits during 2020, climbed even higher in earlier shocks, and fell to roughly 20 during the 1980 metals peak. Today's reading is squarely neutral, well below panic levels and well above the deep-value zone that has historically marked silver bottoms.

What it suggests, taken in pieces:

• Relative valuation: Silver has done much of its catching up against gold over the past year. It is neither cheap nor richly priced at this level.
• Risk sentiment: A ratio in the low 60s reflects a market that is hedged but not panicked. Genuine fear pushes this number sharply higher.
• Inflation expectations: Both metals easing while oil sits above $108 tells you the market sees inflation as a near-term issue, not an open-ended one.
• Industrial vs monetary demand: Years of projected silver supply deficit, combined with the AI and clean-energy capex cycle visible in deals like CATL's, give silver an industrial floor that gold does not have.

The takeaway: Both metals continue to do the unglamorous job they are bought for, which is preserving purchasing power across cycles.

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The Deal Room

M&A / Investments

• China's National Development and Reform Commission ordered the cancellation of Meta's $2 billion acquisition of agentic AI startup Manus, citing technology-leakage concerns.
• Microsoft and OpenAI rewrote their exclusivity pact: Microsoft keeps a non-exclusive license through 2032 and stops paying revenue share, while OpenAI continues paying Microsoft through 2030, now capped, and is free to sell on AWS and Google Cloud, clearing legal risk around its $50 billion Amazon deal.

IPO / Listings

• Bill Ackman's Pershing Square IPO is expected to price at the low end of its range, with the bulk of the book covered by institutions.
• CATL priced its Hong Kong share placement at the bottom of the range and at a clear discount, marking the largest Hong Kong offering of the year so far; shares fell on the news.
• The bigger story is the calendar ahead. SpaceX is set to begin its IPO roadshow in June, Anthropic is targeting an October listing, and OpenAI is eyeing a Q4 debut. Combined, the three could absorb a striking share of second-half IPO supply, and investors are already starting to position for it.

That positioning is already showing up in the private market, where one AI name with a reserved Nasdaq ticker is drawing attention from investors who missed the last cycle.

Retirement Lens

For long-term savers, this week is less about a single decision and more about a pattern of pressure points. Stocks are at records, but breadth is thin. Yields are rising, not falling, just as a likely Fed pause is being framed as the start of a softer regime. Oil keeps a floor under inflation. The consumer, going by Domino's, is visibly tiring.

None of these facts, on its own, calls for action. Together, they describe the kind of environment that punishes overconcentration. A retirement portfolio leaning heavily on the Magnificent Seven names that led the rally is now exposed to a single Wednesday evening of earnings. A portfolio leaning heavily on long-duration Treasuries has just watched its hedge fail to do its job during the Iran-driven yield shock.

The quieter answer is the same one as last week. Diversification across stocks, bonds, cash, and a measured allocation to real assets is not exciting. It rarely makes the headlines. But the central-bank gold bid and the structural industrial demand for silver describe a counterweight that has earned its place in a portfolio designed to last decades.

The other discipline is patience. Records invite chasing. Sharp single-name moves invite reacting. Both are corrosive over a multi-decade horizon. The work of long-term investing in a week like this one is mostly the work of doing less, rebalancing on schedule, and keeping enough liquidity that a bad month does not force a bad decision.

Headline Hunt

• Iran proposed a new framework via Pakistani mediators to reopen the Strait of Hormuz and extend the ceasefire, while deferring nuclear talks until the US blockade is lifted.
• The Bank of Japan held its policy rate at 0.75% in a split 6-3 vote, raised core inflation to 2.8% from 1.9%, and cut FY2026 GDP to 0.5% from 1%.
• The Federal Reserve is expected to hold rates Wednesday in what may be Jerome Powell's final FOMC meeting before Kevin Warsh's confirmation.
• Bond traders have erased expectations for any further Fed rate cuts in 2026 as the oil-driven inflation shock has blown out the popular cut trade.
• BlackRock's Investment Institute reiterated a risk-on stance, overweight US and emerging-market equities and underweight long-term Treasuries, citing what it calls a "diversification mirage" in long bonds.
• Capstone Partners reported that consumer M&A volumes hit a multi-year low in 2025, with valuations also at the bottom of the past decade; the firm projects a gradual 2026 rebound.

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