The Week Ahead: S&P 500 and Nasdaq Hit Record Highs as Tesla Earnings and Iran Talks Take Center Stage

TLDR

• The S&P 500 and Nasdaq hit new all-time highs last week, marking three straight weeks of gains
• Tesla reports Q1 earnings Wednesday, with investors watching its AI and robotics ambitions
• Iran’s foreign minister said the Strait of Hormuz is “completely open,” sending oil prices lower
• The Magnificent Seven stocks have gained 9% over the past five sessions
• March retail sales data drops Tuesday, giving a read on consumer spending under war-time inflation

Wall Street closed out another strong week as two of three major indexes hit record highs. The S&P 500 gained 4.5% for the week, the Nasdaq rose 6.8%, and the Dow added 3.2%. All three posted their third consecutive week of gains.

The rally was driven largely by optimism around US-Iran relations. On Friday, Iran’s foreign minister said the Strait of Hormuz was “completely open” for commercial traffic. President Trump also said Iran had agreed to suspend its nuclear enrichment program and would never again close the strait. A second round of negotiations was scheduled for the weekend.

Oil prices fell sharply in response. Analysts at Rystad Energy called it a “market-moving development of the first order.” But experts warned that even with a deal, it could take weeks or months for oil markets to stabilize. Hundreds of ships remain stuck in the Persian Gulf, and Middle Eastern oil production has been cut by roughly 12.4 million barrels per day.

The Magnificent Seven stocks, tracked by a dedicated ETF, gained 9% over five sessions and are approaching all-time highs. Taiwan Semiconductor reported Q1 earnings that beat expectations, with earnings per share up 66% year-on-year and revenue up 40%.

HSBC’s head of Americas equity strategy said investors should expect a “banner Q1 earnings season,” with the most optimism centered on tech. The Magnificent Seven are expected to report 20% earnings growth, compared to 12% for the rest of the S&P 500.

Tesla’s Big Week

Tesla reports Q1 results on Wednesday. The company broke an eight-week losing streak on Friday. CEO Elon Musk said Tesla is in the final design stages of its AI5 chip, built for EVs, training clusters, and Optimus robots. Reuters also reported Tesla is hiring chip engineers in Taiwan.

Tesla has announced plans to build its own chips at a facility called Terafab, with Intel brought in as a partner. Analysts say building an in-house chip fabrication operation would be a huge engineering challenge.

UBS analyst Joseph Spak wrote that the stock “trades more on sentiment, narrative and momentum than fundamentals.” He flagged concerns around EV demand, an energy shortfall, and slow progress on robo-taxi and Optimus, but said he still views Tesla as a leader in physical AI.

What Else to Watch

Intel also reports earnings Thursday. The chip company traded up to its highest intraday price since 2000 on Friday.

Airline earnings from Alaska Air, United Airlines, and American Airlines will show how carriers are managing soaring jet fuel prices. United Airlines CEO Scott Kirby recently floated a potential acquisition of American Airlines.

Tuesday brings March retail sales data from the Census Bureau. Economists expect a 1.3% increase. The University of Michigan consumer sentiment reading on Friday will also be closely watched. Its preliminary April reading hit a historic low of 47.6 earlier this month.

UnitedHealth Group reports Tuesday, with shares already under pressure from a reported investigation into its insurance billing practices and an unexpected leadership change.

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