Just before the US stock market opened on April 23, 2026, global investors turned their gaze to the strategic choke point of the Strait of Hormuz at the eastern end of the Mediterranean. President Donald Trump, at 3 p.m. local time on the 23rd, issued an immediate order to sink all ships attempting to install mines near the strait via his digital platform, TruthSocial, and directed the US Navy to triple the scale of its operation to remove them. This move is interpreted as an attempt to quell market anxiety that had resurfaced immediately after The Washington Post reported that the US Department of Defense estimated it would take at least six months to completely remove the mines. However, experts remain skeptical that such military intervention will end the situation immediately, and they forecast that the market is likely to remain volatile through the summer.
The day's top story was the quarterly earnings and capital investment plans of electric vehicle manufacturer Tesla. Despite reporting quarterly earnings that far exceeded market expectations, shares started the day in decline. This was attributed to the company's announcement that it would drastically increase its capital expenditure for the coming year from $20 billion to over $25 billion, and that its free cash flow would turn negative. Compounding investor disappointment were decisions to discontinue unsupervised autonomous driving support for existing hardware-equipped vehicles and a delay in the unveiling of the Optimus 3rd generation model. Amidst this, Tesla revealed in its 10-Q report that it had agreed to acquire an anonymous artificial intelligence hardware company, which is being valued at up to $2 billion, sparking strong curiosity across the industry.
The polarization between the software and hardware sectors emerged as the major theme running through the entire market session. ServiceNow, representing the service sector, triggered a sharp decline in the broader software sector after announcing disappointing quarterly earnings and profitability metrics, causing its stock to plummet nearly 15%. Concerns resurfaced that existing software's ability to defend margins would weaken in the age of artificial intelligence. Conversely, surging demand for infrastructure such as data centers and low-earth orbit satellites drove strong performance for analog semiconductor leaders Texas Instruments and STMicroelectronics, which saw significant revenue growth. These companies have established themselves as beneficiaries of the AI infrastructure boom, demonstrating that the market is being restructured around hardware.
Within the AI investment ecosystem, changes in funding methods are drawing attention. SoftBank's move to consider a loan of approximately $10 billion using OpenAI shares as collateral illustrates this trend. While some interpret this leveraging of private equity as a reflection of market confidence in AI, others simultaneously worry that it could fuel an AI-related debt bubble. Currently, there are no clear signs that the AI investment cycle has reached its peak. Google announced the start of construction on data centers in Switzerland and Austria, while Applied Digital secured a $7.5 billion contract from its third hyperscale customer, proving the industry's growth momentum.
Finally, a noteworthy issue is the change in control at apparel brand Lululemon. Shares fell immediately after the announcement appointing Heidi O'Neil, a former Nike executive, as CEO. O'Neil is known for having overseen consumer strategy, products, and the entire brand at Nike, particularly for leading direct sales strategies that contributed to Nike's struggles; this history is seen as a factor dampening market sentiment. Meanwhile, in the nuclear sector, Oklo announced a collaboration with NVIDIA and the Los Alamos National Laboratory on nuclear fuel research, prompting positive reactions such as HSBC upgrading its investment rating to buy.