Stocks rally on earnings optimism as Fed meeting looms. Markets found their footing in Asian trading on Wednesday, April 29, 2026, as worries about the Iran conflict and health of the AI sector eased, optimism over corporate earnings grew, and attention turned to the Federal Reserve’s decision due later.

MSCI’s broadest index of Asia-Pacific shares outside Japan (.MIAPJ0000PUS), opens a new tab reversed earlier losses to rise 0.2 per cent as gains for stocks trading in Hong Kong steadied the index. Japanese markets were closed for a holiday. S&P 500 e-mini futures edged up 0.2 per cent, while Brent crude rose 0.2 per cent to about Ksh17,842 per barrel (converted from $111.51 per barrel) as efforts to end the Iran conflict hit an impasse.

“For us, earnings are the most important part of the story right now,” said Kate Moore, chief investment officer at Citi Wealth. “Q1 earnings are tracking year-over-year growth and climbing,” she said. “Analysts typically spend earnings season revising numbers down. This season, the opposite appears to be happening.”

Corporate America has shown resilience in the face of the Iran conflict: with slightly more than one-third of S&P 500 sectors having already reported profits, 81 per cent of companies have beaten estimates.

Earnings from U.S. tech giants Microsoft (MSFT.O), opens new tab, Alphabet (GOOGL.O), opens new tab, Amazon (AMZN.O), opens new tab and Meta Platforms (META.O), opens new tab, due later on Wednesday, will further test the AI-driven rally.

Tech shares took a hit on Tuesday after The Wall Street Journal reported that AI heavyweight OpenAI had missed internal targets for weekly users and revenue, raising concerns over the ChatGPT parent’s ability to support its massive spending on data centres.

The report weighed on shares of Oracle and CoreWeave on Wall Street on Tuesday, with the S&P 500 (.SPX), opens new tab sliding 0.5 per cent and the Nasdaq Composite (.IXIC), opens new tab falling 0.9 per cent as investors also assessed the impasse in Iran.

U.S. President Donald Trump is unhappy with the latest proposal from Tehran as he wants nuclear issues dealt with from the outset, a U.S. official said. The Journal also reported on Tuesday, citing U.S. officials, that Trump had instructed aides to prepare for an extended blockade of Iran.

Market attention will turn later on Wednesday to the outcome of the Federal Reserve’s April meeting, which will be Jerome Powell’s last as Fed chair. Traders believe a hold is a certainty. Fed funds futures are pricing an implied 100 per cent probability the U.S. central bank will maintain rates, with no policy changes expected until late in 2027, according to the CME Group’s FedWatch tool.

“Given the challenging war-impacted inflation environment, it won’t cost much for the Fed to adopt a hawkish tilt; while remaining in a wait-and-see mode,” analysts from ING wrote in a research report. “There will also be questions on the incoming Kevin Warsh and Powell’s intention to stay or go.”

The yield on the U.S. 10-year Treasury bond was up 0.8 basis points at 4.344 per cent while the U.S. dollar index, which measures the greenback’s strength against a basket of six currencies, edged up 0.1 per cent to 98.71, rising for a second consecutive day.

Markets also digested the surprise exit of the United Arab Emirates from OPEC, though the rest of the oil producer alliance is expected to stick together.