Monday, May 18th, 2026
We begin to wind down Q1 earnings season this week. Key companies are scheduled to report — especially the most “magnificent” of the “Mag 7,” NVIDIA NVDA, along with Home Depot HD, Target TGT and Walmart WMT — but overall reporting volume is taking a step down after the past two weeks of 1000+ companies having reported per week.
We do see some key economic reports this week, as well, although this too winds down a tad. Pending Home Sales on Tuesday — the same day as Home Depot’s earnings report — join Housing Starts and Building Permits later in the week for a look at the still-challenged housing market. Only three of the past 12 months saw positive pending home sales growth.
Oil Prices Stay Above $100/bbl on Strait Stalemate
By far the biggest concern facing the stock market to begin a new week of trading is the continued closure of the Strait of Hormuz, obstructing all but a few oil tanker passages per day, and helping decrease oil reserve levels around the world while gasoline prices continue creeping ever pricier. We’re currently at $103 per barrel (/bbl) on the WTI and $107/bbl on Brent crude, but more importantly, we appear to be at an impasse with the country of Iran, which has clamped down on the Strait in the wake of U.S. and Israel bombings on the country, which started over 11 weeks ago.
President Trump’s visit to China last week looks to have pushed the needle not at all on this burgeoning oil crisis; China is one of the few countries so far allowed to ship oil out of the Persian Gulf, but the U.S. has clearly not won similar considerations. And as we embark on a new summer driving season with Memorial Day Weekend coming up, gasoline and jet fuel demand only look to increase domestically, which would naturally push prices at the pump higher.
The choices currently at hand appear to be widely disparate, and equally unpopular: 1) bring U.S. troops on the ground to march on Tehran and overtake the current Iranian regime, which would cost blood and treasure that would far outweigh what we saw in the nine-year war with Iraq, or 2) make a deal with the Iranian government, which would include major reparations and still leave unclear whether the country would continue to develop uranium for a nuclear arsenal. But to do nothing would be to see oil and other petroleum product shortages to further undesirable levels — and only six months (and counting) from U.S. midterm elections.
This all said, pre-markets have reversed course from early-morning lows, and are now in positive territory across major indexes. This followed the worst trading day on the S&P 500 and Nasdaq on Friday since March, down between -1% (Dow) and -1.55% (Nasdaq). At this hour, the S&P 500 is back above 7400, the Dow back above 49,600, the Nasdaq once again near 29,400 and the small-cap Russell 2000 back above 2800. Discussions about a truce in the Strait add positivity to bargain-hunting early birds in Monday’s market.
BIDU Misses Q1 Earnings, Shares Climb on AI Revenues
Chinese Internet giant Baidu BIDU missed already-lowered earnings estimates in its Q1 report this morning, -6.42% to $1.75 per share, but shares are up +4.8% on the news. The company’s revenue growth on its burgeoning AI business strength was a positive development; we may expect Baidu to shed its Zacks Rank #5 (Strong Sell) and Value-Growth-Momentum grade of “F.”
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