In what could be the most controversial confirmation hearing for a Fed chair nominee in decades, Kevin Warsh is expected to appear today before the Senate Banking Committee at 8am. However, his nomination could be complicated by the criminal investigation against Jerome Powell. Although the committee is composed of 13 Republicans and 11 Democrats, Republican Senator Thom Tillis has pledged to block the confirmation until the legal proceedings against Chair Powell conclude. Should that occur, the vote would be tied at 12, which would delay the formal floor vote in the full Senate.

Our take

The difficult road ahead for Kevin Warsh as the next Federal Reserve Chair, and the likely legal battles that will accompany it, could reignite the dynamics of threats to the Fed's independence. Meanwhile, investors will be closely watching likely questions such as how much he shares the president's view of supporting sharp interest rate cuts. 

Indications that Iran may join negotiations with the US ahead of the imminent ceasefire deadline are improving investor sentiment, though uncertainty persists. President Donald Trump stated it is unlikely he will extend the two-week ceasefire with Iran, which increases the urgency for negotiators to reach an agreement to end the war. US Vice President Vance is scheduled to travel today to Islamabad, Pakistan to lead what could be the second round of peace talks.

Our take

Financial markets are closely following diplomatic efforts in Islamabad, where talks aimed at de-escalating the Middle East conflict are sending mixed signals. While some reports suggested Iran could participate, others indicate reluctance, underscoring the uncertainty ahead of the ceasefire deadline. 

The second round of bilateral talks ahead of the USMCA review left positive signals, with the participation of the US Trade Representative and the establishment of a date for the start of official negotiations in late May in Mexico City standing out. Meetings included key sectors such as steel, automotive, and manufacturing, in a context where tensions persist over tariffs (Section 232) that have affected Mexican exports. However, relevant issues remain open, including non-tariff barriers, energy policy, and regulatory conditions.

Our take

The constructive signals point to a willingness to engage in dialogue that could reduce short-term uncertainty, particularly for integrated production chains. However, the underlying issues, particularly tariffs and regulatory differences, remain unresolved, which limits visibility on the final outcome. In this context, the negotiation process will be crucial for avoiding disruptions in regional trade, though risks remain elevated given the political complexity and the limited time available to reach concrete agreements. 

The ZEW Institute published that its index evaluating the economic sentiment (expectations) of major investors and analysts for Germany fell in April to -17.2 points from -0.5 points in March, reaching its lowest level since December 2022. Meanwhile, the ZEW index measuring these same economic agents' perception of the current situation in Germany's economy fell in April to -73.7 points from -62.9 points in March.

Our take

The April decline of the indicator, following the third-largest monthly drop in the indicator's history recorded in March, reflects growing pessimism as the escalation of the Middle East conflict weighs on Germany's economic prospects. The impact of the war goes beyond rising prices, as fears of long-term energy scarcity are dampening investment and weakening the government's stimulus measures. 

Markets and Stocks

WTI was falling 1.8% toward US$88 and Brent was approaching US$89, with the market responding positively to the day's diplomatic signals. Gold was trading steadily near US$4,800 per ounce. Bitcoin was advancing slightly toward US$76,300. Electric vehicle sales in Europe continue to accelerate, rising nearly a third in the continent's major markets amid historically high fuel prices, in what could be one of the most structurally lasting impacts of the conflict on long-term oil demand.

Corporate News

Grupo Aeroportuario del Pacífico (GAP) reported mixed first-quarter 2026 results, with revenue and operating margin growth that were partially overshadowed by security disruptions in Mexico and the residual impact of Hurricane Melissa in Jamaica.

Our Take 

GAP's performance reflects a company that continues to generate solid operating revenues from its Mexican operations, but faces headwinds outside its control. Total revenues grew 2.8%, while EBITDA advanced 6.4%, improving the adjusted EBITDA margin from 67.1% to 68.3%. Growth was driven primarily by Mexico, where aeronautical revenues rose 9.3% thanks to the gradual implementation of the new 2025–2029 airport tariffs. However, Jamaica, which represents an important component of the portfolio, suffered a 26.2% decline in aeronautical revenues, with passenger traffic contracting 24.6% due to the residual impact of Hurricane Melissa on the hotel capacity of the tourist region. 

Apple announced that John Ternus, current Senior Vice President of Hardware Engineering and responsible for the MacBook Neo, will succeed Tim Cook as CEO on September 1. Cook will remain at the company as Executive Chairman, focused on government relations and geopolitics, including Apple's ties with China and its relationship with the Trump administration. Apple's shares retreated slightly following the announcement.

Amazon announced an additional US$5 billion investment in Anthropic, with potential commitments of up to US$20 billion more linked to commercial milestones, raising its total potential exposure to US$25 billion. The transaction closed at a valuation of US$350 billion, considerably below recent offers from other investors at more than US$800 billion, suggesting Amazon negotiated more favorable terms as a long-term strategic partner. As part of the agreement, Anthropic committed to spending more than US$100 billion on Amazon infrastructure over the next decade.

UnitedHealth reported first-quarter earnings of US$7.23 per share, above the highest estimate in Bloomberg's consensus, and raised its annual earnings guidance by 50 cents per share to at least US$18.25. Shares were up around 7% in pre-market trading.

GE Aerospace reported first-quarter earnings that beat expectations, with revenues growing nearly 30% year-on-year driven by engine maintenance demand. The company maintained its annual earnings guidance of between US$7.10 and US$7.40 per share and indicated it expects results to trend toward the upper end of the range. However, it published new assumptions that include elevated oil prices through the third quarter before moderating toward year-end, and CEO Larry Culp warned that the company is monitoring risks in its customer base.

The to-do list

Quote of the day

"It's not what happens to you, but how you react to it that matters."

— Epictetus