Equity markets declined yesterday on mixed earnings.  Disappointing results from both Alphabet and Samsung overshadowed stronger than expected profits from GE and Pfizer.  Oil rose on Venezuelan unrest, Saudi Arabia signaling a possible extension of production cuts to the end of the year, continued disruption from contaminated oil from Russia and Nigerian unrest.

In many ways it feels as though oil is on the verge of a geopolitical narrative changing melt up and the must own technologies trading back to reality.

Speaking of which, analogies are arising between 2000 and today.  Nineteen years ago “the Four Horsemen” was a household name referring to the unrelenting advance of Intel, Microsoft, Dell and Cisco.  Today it has been replaced by FAANG.

FAANG traded around an 84% premium to the index while the four horsemen traded at a 65% premium, up from 4% from the mid to late 1990s according to Bloomberg.

Change is the only constant.  What has changed is the velocity of change.

Today is the conclusion of the Fed meeting.  No change in policy is anticipated but all are expecting a continuation of the dovish narrative.

Speaking of which, one month ago it seemed like every other story was about the inverted yield curve.  On little fanfare, today the curve is quickly steepening.  Will the Fed make any comments about a radically different bond market than that of one month ago?

Last night most of the foreign markets were closed for May Day celebrations.

The Dow should open moderately higher on earnings and ahead of the outcome of the Fed meeting which is expected to come to a dovish conclusion.   The 10-year is up 1/32 to yield 2.50%.

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