U.S. stocks aren’t behaving as if the cease-fire with Iran is slipping quietly away amid small-boat attacks, cruise missiles, and drone strikes. Markets looks set to deliver a fresh record high for tech stocks on Tuesday.

The fragile truce, first established in early April, is starting to fray around the edges as Iran flexes its muscles on one side of the Strait of Hormuz and the U.S. aims to establish its presence on the other.

That’s had big implications for global crude prices, which have risen some 17% over the past month—pushing Treasury bond yields higher and stoking renewed concerns about inflation and general malaise in the world’s biggest economy. 

It hasn’t, however, had much effect on stocks, prices of which have hit a string of all-time highs powered by solid corporate earnings. U.S. companies, in fact, are on pace for their best quarterly results in four years, with collective S&P 500 profits forecast to rise a staggering 28% from last year to around $678 billion.

The disconnect between soaring tech stocks and the rest of the market is startling. That comes in tandem with the transformational bets on artificial intelligence.

But in some respects it’s also justified: tech isn’t bound to global oil prices, generates revenue freely even in the face of autocratic rule, and appears to find few if any barriers to its ambitions in the corridors of Washington. 

U.S. stocks have learnt to deal with soaring oil prices—managed through spikes in Treasury yields—and weathered the impact of consumer spending downturns tied to a moribund labor market.

Tech, however, is the market’s North Star and even war with Iran isn’t about to change that.

—Martin Baccardax

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Elon Musk is paying a pittance to settle a Securities and Exchange Commission lawsuit that said he failed to timely disclose his stake in Twitter as he was preparing to buy it in 2022. The settlement is a win for billionaire Tesla CEO Musk and a very small win for SpaceX.

• The SEC’s proposed settlement puts Musk on the hook to pay $1.5 million, far less than the agency originally sought. SEC rules give investors 10 days to report the accumulation of 5% or more of a company’s stock. Musk waited 11 days on top of that to disclose.

• Musk had a 5% stake in Twitter by March 14, 2022, and disclosed it on April 4. He ultimately bought Twitter in 2022 for $44 billion and renamed it X. The SEC contends that the disclosure delay meant Musk underpaid for the stock he was accumulating by $150 million.

• Twitter’s shares jumped nearly 30% the day Musk disclosed his 5% stake. His family trust, which is paying the proposed settlement amount, bought $500 million more of shares in the period between passing that 5% threshold and the ownership disclosure, The Wall Street Journal reported.

• The suit might have been a minor issue for SpaceX’s IPO. Musk’s artificial intelligence company xAI merged with X in 2025, and SpaceX merged with xAI in February, so X is now part of SpaceX. The space company plans the record IPO to fund putting AI data centers into orbit. 

What’s Next: Musk still faces liability in a class-action shareholder lawsuit over his Twitter stock purchase. In March, a jury sided with the plaintiffs over the issue. Total damages could reach $2.6 billion. The case is being appealed.

—Al Root

The Justice Department asked a federal judge on Monday to vacate his ruling in the Jerome Powell case, a move that could prevent the decision from being cited as precedent in future investigations. The motion comes 10 days after prosecutors announced the closure of the criminal inquiry into the Federal Reserve chair.

• U.S. District Judge James Boasberg quashed the Justice Department’s subpoenas in March, ruling prosecutors had issued them not to gather evidence but to “harass and pressure” Powell.

• The investigation focused on Powell’s oversight of a multibillion-dollar renovation of the Fed’s headquarters. Critics of the inquiry argued the investigation was an attempt to pressure the central bank or remove Powell from his post. The Fed and Powell have denied any wrongdoing in the renovation.

• In Monday’s filing, U.S. Attorney Jeanine Pirro asked Boasberg to vacate his ruling under a 1950 Supreme Court precedent known as the Munsingwear doctrine, which allows judges to set aside rulings in cases that have become moot, or irrelevant.

What’s Next: Powell’s term as chair ends May 15. He has said he intends to remain on the Fed’s board as a governor, a position he can hold until 2028, until he feels comfortable the investigation is fully resolved. The closure of the criminal inquiry and Monday’s filing leave that condition ambiguous.

—Nicole Goodkind

Palantir Technologies, the analytics software company whose CEO Alex Karp has become a political lightning rod, beat Wall Street expectations on all its key first-quarter metrics: Sales, adjusted operating margin, and adjusted free cash flow margin. It has beat expectations for 11 consecutive quarters.

• It reported adjusted earnings of 33 cents a share and revenue of nearly $1.63 billion. Karp said the results demonstrate a level of strength that “dwarfs the performance of essentially every software company in history at this scale.”

• Although much of its coverage revolves around Palantir’s government defense and intelligence contracts, its U.S. commercial sales were the star of the show. While U.S. government sales grew at a 84% clip in the quarter, to $687 million, commercial revenue rose 133% to $600 million.

• Palantir uses artificial intelligence to draw relationships between disparate data points of an organization’s data, often spread out across many systems and formats, to help customers with decision-making. It is one of the few companies that has healthy profit margins selling AI services.

• The theme of Palantir’s releases and the scripted portion of its earnings call was that its framework for using AI, grounded in an organization’s data, makes it a “non-slop-zone.” Karp told shareholders: “We stand on the walls, sentinels of the inner sanctum, against the assault of AI slop.”

What’s Next: Palantir’s second-quarter revenue guidance of $1.797 billion to $1.801 billion was above analysts’ projections, and adjusted operating income was well in excess of what Wall Street was banking on. It also significantly raised its full-year guidance, to between $7.65 billion and $7.66 billion.

—Adam Levine and Janet H. Cho

Fresh off winning the bidding war for Warner Bros. Discovery, Paramount Skydance beat expectations for first-quarter earnings. Streaming revenue showed growth, though traditional TV media sales continue to decline as more people turn to on-demand platforms.

• Paramount reported first-quarter adjusted earnings of 23 cents a share and a 2% rise in revenue to $7.35 billion. First-quarter TV Media revenue fell 19% to $3.67 billion, far worse than expected, but revenue at Paramount+ rose 17% to $1.97 billion.

• Streaming subscribers on that platform rose 2% to 79.6 million. For the second quarter, Paramount forecasts total revenue between $6.75 billion and $6.95 billion, which would be a range of negative 1% or positive 1% over last year. It blamed a “difficult comparison to theatrical revenue” last year.

• Paramount said it expects healthy underlying subscriber growth for the Paramount+ platform, but quarter to quarter subscriber numbers are expected to be flat. It says it sees the strategic exit of two million international hard bundle subscribers.

• CEO David Ellison has said investing in the direct-to-consumer business was a top priority. The addition of Warner Bros. Discovery brings the HBO streaming platform as Paramount tries to compete with streaming rivals Netflix and Walt Disney. One way Paramount is looking to grow is through a major acquisition.

What’s Next: Paramount won the monthslong battle for Warner Bros, chasing Netflix away. Warner Bros. announced on April 23 that stockholders approved the deal. Paramount Skydance said again on Monday that the deal is expected to close by the end of the third quarter of 2026, subject to regulatory approval.

—Angela Palumbo and Kit Norton

When President Donald Trump said he is raising tariffs on cars from the European Union to 25% it was a reminder that he will continue to move these levies up and down—and add more. The administration has been working on new tariffs to replace those struck down by the Supreme Court.

• While he can’t use the International Emergency Economic Powers Act, Trump has other laws at his disposal, including Section 232 of the Trade Expansion Act of 1962. King & Spalding partner Ryan Majerus, a former U.S. trade official, says Trump has quite a degree of flexibility with Sections 232 and 301. 

• The administration is leaning mostly on Section 301 to rebuild the tariffs the Supreme Court struck down and that can be refunded. Once those are in place, Majerus says, they too can be used flexibly. He expects these tariffs to be used as an enforcing mechanism for trade pacts as well as non-trade related issues.