Welcome to Wild Wednesday when a maelstrom of factors leaves the stock market needing some of its most trusted Big Tech names to lead it through the chaos.

Four of the Magnificent Seven group of megacap tech companies report earnings after the close, while the Federal Reserve will make its latest interest-rate decision on a big day for investors. 

Stocks will start it near record highs. The Nasdaq Composite has jumped 14% in April, on track for its best month since April 2020 and its 8th best on record, according to Dow Jones Market Data.

But the tech sector’s rally had a wobble Tuesday following a report that OpenAI missed revenue targets and the board has questioned its huge data-center spending. The company said it’s “firing on all cylinders,” in a statement to Barron’s.

However, the AI panic raised the stakes ahead of earnings by Alphabet, Amazon, Meta and Microsoft, which all come after the close. The last thing the market needs after the OpenAI scare is for any of the large hyperscalers to hint at a slowdown in capital expenditure.

That day will arrive, but it would be a big surprise if it comes today. Instead, investors will be hoping stellar cloud revenue growth is the story.

Earnings reports are driving the market mood right now, particularly on a sector level—just look at Intel at the end of last week or Seagate Technology late Tuesday.

Oil prices, the chief catalyst for much of March, are largely being ignored by markets despite Brent crude climbing as high as $108 a barrel early Wednesday after the U.A.E. left OPEC and as President Donald Trump ramped up his rhetoric against Iran. The Federal Reserve’s latest interest-rate decision, and potentially Chair Jerome Powell’s last press conference in charge will also be key for investors.

With stock markets near record highs, AI fears lingering like a bad smell, and earnings in the driving seat, the stage is set. The Mag 7 companies just need to deliver—or the AI scare will turn into a nightmare.

—Callum Keown

Get more of the journalism you love. Choose Barron’s as a preferred source in Google.

The fracturing of the OPEC alliance leaves the group in a diminished state, with much less ability to control prices even after it emerges from the Iran war. The United Arab Emirates’ departure, won’t change oil prices in the short term but is likely to depress them long-term.

• The cartel dominates the oil market by strictly rationing production by member nations. The U.A.E. is the third-largest producer in OPEC, pumping out about 3.6 million barrels a day in normal times. The country has long chafed at OPEC’s limits and argued it should be allowed to produce more.

• A full break, however, changes the game. It turns a long-running dispute over oil production limits into a formal rupture while the Iran war is already testing the cartel’s grip on global crude markets. OPEC has already been feeling extreme pressure in recent months—Iran and Venezuela are members.

• The Iran war primarily drives oil prices today. Brent crude rose nearly 3% to above $104 a barrel on Tuesday as peace talks have hit an impasse. The U.A.E.’s Ministry of Energy and Infrastructure announced its exit from OPEC on May 1. It cited national interests.

• The U.A.E. has reportedly been looking for financial aid from the U.S. as the war drains its finances. Before the war, the Trump administration looked to Middle East producers to boost output to help reduce oil prices. The U.A.E. could more easily comply with such requests if it’s no longer in OPEC.

What’s Next: U.A.E. wants to lift production capacity to 5 million barrels a day by 2027 but has been constrained by OPEC limits. Outside of the alliance, the U.A.E. will now feel the freedom to ramp up quickly—which could depress oil prices. The U.A.E. said it still plans to produce responsibly.

—Avi Salzman and Laura Sanicola

Investors are destined to face “some kind of bond crisis” if world leaders don’t deal with high debt levels, JPMorgan Chase CEO Jamie Dimon warned at an investment conference in Norway Tuesday.

• Dimon was asked about the high levels of government debt around the world. “The way it’s going now, it would be some kind of bond crisis, and then we’ll have to deal with it,” he replied, making the point that action should be taken to prevent a crisis “as opposed to letting it happen” and having to clean it up.

• Higher debt equates to a bigger interest burden for a government, creating a feedback loop that raises concerns about whether a nation is able to pay back both the principal and interest.

• “I don’t know how the world running deficits like this isn’t inflationary,” Dimon said at a conference in Oslo held by Norges Bank Investment Management. “That die may have been cast. It just hasn’t happened yet.” So far in fiscal 2026, which started in October, the government has spent $1.17 trillion more than it has collected. Such deficits are also inflationary because they can increase the amount of money in the system.

What’s Next: A rise in inflation “becomes more ingrained the longer the Strait of Hormuz remains closed,” ING’s Padhraic Garvey wrote in a note on Monday. If the 10-year breakeven inflation rate were to rise above 2.5% and keep going, it would be hard to lower interest rates and would be outright negative for U.S. debt, he adds.

—Karishma Vanjani

Starbucks posted its first earnings growth since 2023 from the comparable period a year earlier, a key benchmark for the coffee giant’s two-year revamp efforts. CEO Brian Niccol said the quarter was a milestone for Starbucks, marking the turn in that turnaround.

• The company has targeted a broad reset under its “Back to Starbucks” strategy after struggling with slowing growth in its core U.S. market amid higher cost beverages and deteriorating services. The revamp focuses on improving store operations, simplifying menus, and speeding up service.

• For the three months ended in March, the coffee chain posted a 9% rise in net revenue, to $9.5 billion, and earnings of 50 cents a share. Both beat expectations. Notably, U.S. comparable sales increased 7.1% from a year ago, continuing the strength from the previous quarter.

• Global comparable sales increased 6.2% from a year ago, spurred by higher menu prices and improving transaction volume. Starbucks is also reshaping its global footprint, including a new China joint venture aimed at accelerating growth while improving capital efficiency.

• There are early signs the revamp is gaining traction. In the December quarter, U.S. comparable sales rose 4%, with transactions turning positive for the first time in eight quarters. As sales recover, however, margins have been under pressure by higher labor costs, coffee prices, and investments.

What’s Next: Tuesday’s report has given investors confidence that Starbucks’ traffic gains in the U.S. are sustainable and that the company could translate the improved traffic and sales into earnings growth. Niccol said more customers are getting back to Starbucks as consistency improves.

—Evie Liu

Travelers could again face longer lines at airport security checkpoints if Congress doesn’t figure out a way to fund the Department of Homeland Security this week. Emergency funds that have been paying Transportation Security Administration workers during funding shutdown are quickly depleting.

• President Donald Trump allocated $10 billion in emergency funds for DHS employees in executive orders in March and April. Those funds are set to run out in early May. Overall, DHS has faced this funding issue since the shutdown began in February, more than 70 days ago.

• House lawmakers are currently deliberating a Senate-approved bill to fund DHS, separating out funding for Immigration and Customs Enforcement or Customs and Border Patrol. The Senate had to remove those agencies from the bill to win support from Democrats who want to see more humane immigration enforcement.

• ICE remains a sticking point for a small group of House Republicans who don’t want to see it split off into a separate bill. They may not approve the measure until the Senate passes a separate bill to fund ICE and CBP through reconciliation. The Senate is working on that. 

• Agency funding isn’t the only issue facing travelers. Online travel site Booking Holdings says the Iran War is affecting demand for some travel services. While it beat first-quarter profit expectations, it cut full-year revenue growth projections.

What’s Next: Congress is out of session next week, so both chambers must pass DHS funding measures by Friday for workers to be guaranteed their pay in early May. A union official representing TSA officers told CNN on Tuesday that there is a 50-50 chance TSA workers will be paid next week.

—Emily Russell and Janet H. Cho