Good morning, investors. The AI and chip super-cycle continues to win the day.

Micron gained 11% on Tuesday to push its 2026 return above 100%, AMD reported blowout earnings, and Alphabet overtook Nvidia as the most valuable company in the world after a new deal with Anthropic.

(We published all three names in our Best Ideas Club months ago for triple-digit returns.)

If earnings are any sign, the momentum isn’t slowing down soon.

Analysts are turning far more bullish than usual.

For the second quarter, S&P 500 bottom-up earnings estimates moved up 2.1% in April to $80.47 from $78.84, the largest jump in five years, according to FactSet.

That breaks one of the most reliable seasonal patterns on Wall Street.

The index's earnings power is being repriced by the day, despite the ongoing oil shock and geopolitical uncertainty.

In a note to clients, FactSet’s John Butters noted that over the past five years, analysts have cut estimates by an average 0.9% during the first month of a quarter.

Zoom out to 20 years and the typical haircut widens to 1.9%.

The last time analysts raised first-month estimates this aggressively was the second quarter of 2021, when post-pandemic earnings were rebounding.

The latest upward revision is particularly counterintuitive given the geopolitical backdrop.

The Strait of Hormuz remains shut, oil prices remain elevated, and there is little sign of an obvious exit plan in Iran.

Wall Street remains confident in corporate America, however.

Six of eleven sectors have seen a positive revision in their earnings estimates, with energy seeing the largest upward revision at 45%.

Industrials took the largest cut at 2.9%.

Valuations now hover at levels that make recession chatter sound outlandish.

To be sure, energy sector revisions are notoriously cyclical, and elevated oil can fade quickly if OPEC+ ramps up production or the Iran conflict comes to an end.

Outside of that, the April upgrades are more modest, leaving room for historical trends to take over.

But the pattern still is important to note.

The first-month earnings cut, one of the most predictable trends on Wall Street, did not show up to start the year.

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🚀 Pfizer crushed first-quarter expectations on stronger drug sales. Adjusted EPS landed at 75 cents on $14.45 billion in revenue, beating Wall Street's 72-cent and $13.79 billion estimates, and the company reaffirmed its full-year 2026 guidance. (CNBC)

📉 Palantir fell 7% despite a record first quarter. Revenue jumped 85% to $1.63 billion, but valuation worries at roughly 78 times sales sparked a sell-the-news reaction. (Motley Fool)

📈 Bitcoin hit $81,000 to mark its highest level since January. The cryptocurrency rose more than 5% over the past five days. (Yahoo Finance)

📊 Business is changing in subtle and seismic ways. Compound Interest, a new podcast from Semafor Business, features the operators and innovators behind the world’s most consequential companies. In a must-hear episode, Mark Cuban talks about his pharma fight, Dallas Mavs regrets and the PE-ification of sports.

The global economy hinges on the Strait of Hormuz right now. I sat down with Kpler lead oil analyst Matt Smith to unpack the outlook for tankers traveling through the strait, Iran’s leverage over energy markets, and what has to happen for crude to rise to $150 a barrel.

Tune in on Spotify, Apple Podcasts, or YouTube!

🗓 May 6, 2010: The Dow Jones Industrial Average saw a flash crash, dropping nearly 1,000 points in minutes, briefly wiping out almost $1 trillion in market value before recovering most of the loss.

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