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Market Snapshot

📉 Banana Bits

• A quake in northern Japan triggered tsunami warnings and coastal evacuations.

• China’s silver imports hit record highs on a solar boom and retail frenzy.

• Despite tensions, China is turning to U.S. ethane as the Iran war reshapes trade flows.

• An AI scare has pushed Asian regulators to probe banks.

• Emerging-market stocks rebounded from war lows on AI optimism and peace hopes.

• Crude spiked after a U.S. ship seizure escalated Iran tensions.

Market News

Risk-Off Mode Returns

Oil surged, and risk assets slipped at the start of the week after a turbulent weekend in the Middle East cast fresh doubt on the prospects for peace talks ahead of an approaching ceasefire deadline.

Brent crude climbed more than 5% toward $95 a barrel after the U.S. Navy seized an Iranian vessel in the Strait of Hormuz.

The move came just hours after Iran briefly halted ship traffic through the vital waterway before reopening it, highlighting how quickly tensions can disrupt one of the world’s most important energy chokepoints.

The spike in oil prices sent ripples through global markets. Futures for the S&P 500 fell about 0.5% after the benchmark recently logged a string of record highs, while European stocks dropped around 1%.

Bond yields pushed higher in Europe and edged up in the U.S., the dollar strengthened modestly, and gold slipped slightly below $4,800 an ounce. In other words, classic risk-off behavior occurs when geopolitical headlines suddenly matter more than earnings reports or economic data.

Still, investors aren’t completely abandoning hope that diplomacy will prevail. Traders say both sides face strong incentives to reach a deal before the ceasefire expires, even if negotiations remain volatile.

Iranian President Masoud Pezeshkian signaled that the war benefits no one and emphasized diplomacy as the path forward, while U.S. officials continue to weigh next steps.

For markets, geopolitics is currently stealing the spotlight from otherwise supportive fundamentals. The S&P 500 recently erased all of its war-driven losses thanks to a powerful rebound led by technology stocks, with the so-called “Magnificent Seven” up roughly 20% since late March.

Earnings season has also started strong, with profits beating expectations by about 11% so far. But until tensions ease, investors may keep one eye on corporate results, and the other firmly fixed on the Strait of Hormuz.

Peel Take: Markets had been riding strong earnings and tech momentum, but a spike in oil and fresh tensions quickly changed the mood. It’s a classic case of fundamentals taking a back seat when geopolitics gets loud enough. For now, investors aren’t ignoring the rally; they’re just watching the headlines a lot more closely.

What's Ripe

Ally Financial Inc. (ALLY) 8.1

• ALLY climbed 8.1% after the online bank and auto lender swung to a profit and reported higher revenue in its latest quarter. The company also increased its provision for credit losses, funds set aside to cover potential loan defaults, by $276 million to $467 million.

• Peel Take: The market clearly liked the turnaround story. While the jump in credit-loss provisions shows the lender is bracing for potential borrower stress, investors focused on the bigger picture: profitability is back, and revenue is growing. In other words, the company may be preparing for tougher credit conditions, but for now, Wall Street seems happy that the business is making money again.

State Street Corp. (STT) 2.5%

• STT rose 2.5% after the asset manager reported better-than-expected first-quarter adjusted earnings and revenue. The firm also said assets under management climbed 20% to $5.6 trillion, reflecting strong market performance and client inflows.

• Peel Take: Markets rewarded the combination of earnings strength and growing scale. Rising assets under management are the lifeblood of asset managers because larger portfolios translate directly into higher fee income. For investors, the takeaway is simple: as markets rise and assets swell, firms like State Street tend to benefit from the compounding effect of bigger pools of capital.

What's Rotten

Netflix Inc. (NFLX) 9.7%

• NFLX slumped 9.7%, making it one of the worst performers in the S&P 500. While the company posted solid first-quarter earnings, investors were disappointed by weak forward guidance despite recent price hikes. The firm also announced that co-founder and chairman Reed Hastings will step down to focus on philanthropy and other pursuits.

• Peel Take: Strong earnings weren’t enough to calm investors this time. Markets tend to care more about where a company is going than where it has been, and the weaker outlook overshadowed the quarter’s results. Add in leadership transition news, and the narrative quickly shifted from “steady streaming growth” to “uncertain next episode,” sending the stock sharply lower.

Alcoa Corp. (AA) 6.8%

• AA sank 6.8% after the aluminum producer reported first-quarter earnings and revenue that missed analysts’ expectations, weighed down by higher costs and softer demand. The decline came despite a massive 202% rally over the past 12 months, fueled by U.S. aluminum tariffs under Donald Trump and supply disruptions linked to the Strait of Hormuz conflict and the 2026 Iran war.

• Peel Take: After a year-long rally powered by geopolitics and tariffs, the market finally asked a simple question: but how are the actual numbers? When earnings and revenue missed expectations, the stock gave back some gains. It’s a reminder that while wars, tariffs, and supply shocks can send commodity stocks soaring, fundamentals eventually take center stage, even for metals riding a geopolitical boom.

🧠 Technical Trip

Interview Q&A from Jane Street

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📚 Lesson from the Library

🎥 DCF Modeling Course: Valuing Cash Flow, Not Hype

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🌟 WSO Academy Q4 Update

🧠 Improved Mentor Preparation Before Sessions

We’ve also upgraded the system to give mentors more context about students’ background + prior sessions. Ultimately, equipping them with all the information they need about you before your session begins.

Mentors now have easier access to:

• Notes and feedback from students’ previous sessions

• Students’ progress within the program

• Students’ recruiting goals and timeline

This allows mentors to pick up right where the previous session left off and give more targeted advice during each call.

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🦈 Deal Deep Dive

M&A, IPOs, And Other Notable Transactions

• AirTrunk is expanding in India with the Lumina acquisition.

• AirAsia is seeking $230M in debt as private credit gains traction.

• QXO is acquiring TopBuild in a $17B expansion move.

• American Airlines dismissed speculation about a merger with United.

📊The Daily Poll

Previous Poll:

If manufacturing growth spreads beyond AI, what does it signal?

Broader recovery: 13.8% // Strong demand: 34.5% // Business confidence: 34.5% // Economy stabilizing: 17.2%

Student Success Corner

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Banana Brain Teaser

Previous

The charge for a single room at Hotel P is 25% less than the charge for a single room at Hotel R and 10% less than the charge for a single room at Hotel G. The charge for a single room at Hotel R is what percent greater than the charge for a single room at Hotel G?

Answer: 20%

Today

Two water pumps, working simultaneously at their respective constant rates, took exactly 4 hours to fill a certain swimming pool. If the constant rate of one pump was 1.5 times the constant rate of the other, how many hours would it have taken the faster pump to fill the pool if it had worked alone at its constant rate?

How Would You Rate Today's Peel?

Happy Investing,
Chris, Vyom, Ankit, Mitchell, Fernanda, Nick, & Patrick

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