“Many of the truths we cling to depend greatly on our own point of view.”
— Obi-Wan Kenobi, Return of the Jedi
May 4th has become “Star Wars Day,” turning a clever British political pun into a global pop-culture phenomenon. Bobby and I just returned from a quick trip to London, and while the jet lag is real, the perspective shift was even more significant. Looking at the world through a non-U.S. lens is a healthy refresh; it reminds us that while we focus on domestic policy, the global “machinery” is grinding through a very different set of gears.
The wild thing about April is how little changed on the ground, yet how much changed on the scoreboard. Is the Strait of Hormuz open? Effectively, no. The “dual blockade” remains the most significant energy disruption we’ve seen in decades. Is the conflict in Iran over? No. Is there a peace deal? Not to my knowledge. Yet, the market just turned in a performance that should make any investor pause and check their screen twice.
The April Scoreboard
- S&P 500: Up 9.7% (Officially crossing the 7,000 milestone)
- Nasdaq Composite: Up 14.0%
- MSCI All World Ex US: Up 5.8%
- Bloomberg Aggregate Bond Index: Up 0.1%
- PHLX Semiconductor Index (SOX): Up 34.6%
Source: ycharts.com
I honestly had to do a double-take as I typed those numbers. Are you serious? The Nasdaq has gone up 14% in a single month? To put that in perspective, the Nasdaq’s annualized return over the past 40 years is approximately 11%. And let’s be clear: oil is still hovering around $100 per barrel.
In any “normal” historical cycle, war and $100/barrel oil act as a tax on the consumer and a drag on corporate margins. Usually, that means stocks go down. Yet, the market barreled through to new all-time highs. There are only two plausible explanations: either the market has it dead wrong, or there is something else driving the ship that is vastly more powerful than the headlines of international conflict.
Source: ycharts.com
The Fed: A Changing of the Guard
We are currently in a strange “limbo” period for American monetary policy. Kevin Warsh was cleared by the Senate in April to take over as Federal Reserve Chairman, yet Jerome Powell’s term doesn’t technically expire until May 15th.
At the start of 2026, the consensus was for three or four interest rate cuts. Today, the market thinks we will be lucky to get one cut this entire year. The conflict in Iran and the resulting energy prices comprise the heart of this “higher for longer” reality. Usually, the market hates it when rate-cut expectations are slashed, but the optimism for how Warsh will steer policy is what the marketing seems to be betting on.
Economic Growth: The K-Shaped Disruption
Economic growth is holding steady at 2% for 2026, which is exactly in line with expectations. However, looking at the “2%” headline is like looking at a lake and assuming it’s four feet deep everywhere—you can still drown in the deep spots. We are seeing a “K-shaped economy” in its most aggressive form.
The top half of the economy—fueled by asset appreciation and high-skill tech employment—is thriving. The bottom half is struggling under the weight of “sticky” inflation at the grocery store and the gas pump. Disruption is inherently disruptive; there will be winners and losers. At Green Ridge, we look to win on the investing front. While the social implications are heavy, we must operate in the market we have, not the one we wish for.
Political Uncertainty: Silencing the Noise
I’m going to be blunt: the market is currently ignoring the noise out of Washington. Between “policy by tweet” and the looming election cycle, the geopolitical backdrop is as messy as it’s ever been. This might be a massive mistake on the market’s part—an “anchoring bias” where we assume the global order will eventually right itself. But for now, investors are looking past the “Twitter-sphere” and focusing on the earnings growth of the companies that actually drive the economy.
The AI Phenomenon: A 27.1% Revelation
If you want to know why the market is up 10% in a month while the world feels like it’s on fire, look no further than the Q1 earnings season. As of May 1st, the earnings growth rate for Q1 2026 is a staggering 27.1%.
This is the highest growth rate we’ve seen since the post-pandemic rebound of 2021. But there’s a catch: without the Technology sector, earnings only grew 5%. The tech sector itself grew earnings by 45–50%, and semiconductors grew by nearly 95%.
Citations: https://insight.factset.com/sp-500-earnings-season-update-may-1-2026
We are witnessing an unprecedented “Arms Race.” Capital Expenditure (CAPEX) on AI infrastructure and cloud computing is estimated to be 83% higher than it was in 2025. The tech titans aren’t just spending money; they are building the “Economic Engine 2.0.” The market is clearly saying there is more risk in missing this generational opportunity than there is in falling victim to a temporary bubble.
Conclusion: Navigating the Asteroid Field
The “Dark Side” of geopolitical tension and energy crises is a formidable force. It causes real pain and real volatility. But right now, it isn’t powerful enough to destroy the “New Hope” of AI-driven productivity and blockbuster earnings growth.
I know, that’s super cheesy. I don’t mean to make light of the deadly situations evolving across the globe. But as your Chief Investment Officer, I have to tell you: that isn’t the movie the market is watching right now. If you’re focused only on the headlines, you’re missing the storyline happening on the big screen.
We can’t say for certain how this sequel ends, but we also can’t spend all day screaming “It’s a trap!” like Admiral Ackbar. The data tells us that even in a high-interest-rate, high-oil-price environment, companies that innovate are being rewarded with massive capital flows.
At Green Ridge, we promise to keep an open mind, stay fluid, and continue to navigate through the asteroid field.
“A way there always is.” — Yoda
Jordan Kaufman
Chief Investment Officer
Green Ridge Wealth Planning
Disclosure:
Green Ridge Wealth Planning, LLC is a registered investment adviser. The information provided here is for general informational purposes only and should not be considered an individualized recommendation or personalized investment/tax advice. The investment/tax strategies mentioned here may not be suitable for everyone. Each investor needs to review an investment/tax strategy for his or her own particular situation before making any investment decision(s). You are responsible for consulting your own investment and/or tax advisor as to the consequences associated with any investment.
The opinions referenced are as of the date of publication and are subject to change due to changes in the market or economic conditions and may not necessarily come to pass. Any opinions, projections, or forward-looking statements expressed herein are solely those of the AUTHOR, may differ from the views or opinions expressed by other areas of Green Ridge Wealth Planning