What's Going on at OpenAI? 8 Key Items Shaping the Stock Market Tuesday

These are the early headlines and other items poised to influence the market at the start of trading Tuesday. As we share this collection of market drivers, U.S. equity futures point to a mixed market open.

1. U.S. President Donald Trump is unhappy with the latest Iranian proposal on resolving the two-month war, a U.S. official said, dampening hopes for resolution of a conflict that has disrupted energy supplies, fuelled inflation, and killed ‌thousands. Iran's latest proposal would set aside discussion of Iran's nuclear programme until the war, on hold following a ceasefire announced earlier this month, is ended and disputes over shipping from the Gulf are resolved. (Reuters)

That Trump is unhappy with Iran’s proposal is far from surprising, in our view, given the president’s multiple comments about Iran and nuclear capabilities. For him to backtrack on this now would result in yet another TACO moment. In the meantime, oil prices are once again moving higher this morning, and with no real progress between the US and Iran, ING raised its oil price outlook for Brent to average $104/bbl. That assumes a gradual resumption of flows starting in May and June, with volumes below pre-war levels for most of 2026.

Coupled with reports of German Chancellor Friedrick Merz saying the U.S. is being ”humiliated” by Iran and Russian President Vladimir Putin praising the Iranian people for resistance to the U.S. have the potential, it runs the risk of Trump taking brash action to regain the narrative, in our view. The president has already hinted at plans to re-establish tariffs struck down by the U.S. Supreme Court.

And on that tariff note…

2. General Motors Co. raised its profit outlook for the year by $500 million, saying its pickups and sport utility vehicles continue to sell even as gasoline prices soar due to the war in Iran… Demand for GM’s lucrative pickup and SUVs, its largest profit generators, remained resilient despite the average price for regular unleaded surging above $4 a gallon. Lower EV sales also helped GM’s bottom line, since those models lose money, and the company has faced lower tariff exposure than it expected a year ago. (Bloomberg)

What that doesn’t tell you is that the $500 million by which General Motors (GM) raised its guidance is the same amount it expects to get back in refunds stemming from a U.S. Supreme Court ruling that struck down some of the Trump administration's tariffs. This serves as a reminder to us of the importance of digging into a company’s results and guidance rather than making the herd-like mistake of not reading past the headlines.

3. We continue to expect little to no recovery in most end markets this year, given current customer sentiment and the leading indicators we monitor. Geopolitical events are adding further demand uncertainty, along with potential inflation related to raw materials, energy, logistics and packaging. In this environment, we continue to focus on securing incremental volume, balanced with appropriate and decisive pricing and cost-out actions to maintain the products, services and supply solutions that drive productivity and profitability for our customers. Specifically, we are continuing to implement targeted price increases by end market and geography across all of our businesses. (Sherwin-Williams Q1 2026 earnings release)

That’s from paint and coating company Sherwin-Williams (SHW) . Inside its Q1 2026 earnings presentation, we find comments that home sales, both existing single-family and multi-family, remain soft. A bright spot was the property maintenance market, better known as repair and remodel, which is one we’ve discussed with Pro members before, and we continue to look for well-positioned plays on that spending. Renewed inflation pressures are a headwind for that spending, but to us that means at some point there will be catch-up spending by consumers. We’ll continue to watch this closely.

4. OpenAI recently missed its own targets for new users and revenue, stumbles that have raised concern among some company leaders about whether it will be able to support its massive spending on data centers. Chief Financial Officer Sarah Friar has told other company leaders that she is worried the company might not be able to pay for future computing contracts if revenue doesn’t grow fast enough, according to people familiar with the matter. Board directors have also more closely examined the company’s data-center deals in recent months and questioned Chief Executive Sam Altman’s efforts to secure even more computing power despite the business slowdown… (WSJ)

From chips to networking equipment and other aspects of digital infrastructure, this WSJ report is going to weigh on shares of those companies that zoomed higher in recent weeks. Measured in a vacuum, it will raise questions over AI adoption and usage and that significant ramp in hyperscaler capex spending.

Two things spring to mind. First, given its capital raising activity, it’s quite possible that OpenAI’s forecasts were aggressive or, as former Fed Chair Alan Greenspan might say, “irrationally exuberant.” The faster the growth, the bigger the valuation, the more capital one can raise. Second, based on reported gains by Anthropic, Google (GOOGL) , and others, it’s also possible that OpenAI is losing share. We’ve seen this happen to early movers before.

Based on the AI adoption and usage metrics we’re seeing and other signals we share with Pro members, it smells more like those two items are what’s at play here. Quarterly results this week from Microsoft (MSFT) , Amazon (AMZN) , Meta (META) and Google will shed even more light on what’s going on at OpenAI.

Adding some support to that thinking…

5. Citigroup raised its global artificial intelligence market forecast, citing faster-than-expected enterprise adoption of artificial intelligence tools for coding and automation, with companies such as Anthropic showing strong ‌revenue growth. The Wall Street brokerage, in an April 27 note, expects the global AI market to reach more than $4.2 trillion by 2030, with roughly $1.9 trillion of that tied to enterprise AI. (Reuters)

And speaking of Google and AI…

6. Alphabet's ‌Google joined a growing list of technology firms to sign a deal with the U.S. Department of Defense to use its artificial intelligence models for classified work, The Information reported on Tuesday, citing a person familiar with the matter. The agreement allows the Pentagon to use Google's AI for “any lawful government purpose”, the report added, putting it alongside OpenAI and Elon Musk's xAI, which also have deals to supply AI models for classified use. (The Information)

It was only a matter of time, is our thinking, given not only the progress Google has made on the AI front, but also the existing relationship between the Department of Defense (DoD) and Google Cloud. While Google may crow about this on its earnings call this week, let’s remember that in addition to using OpenAI and xAI, the DoD has also been using Meta’s AI technology. With that in mind, over time, we’ll look to see if the DoD looks to consolidate its AI efforts on a smaller cohort of providers.

7. Economic data today per TipRanks: ADP Employment Change (Weekly), FHFA Housing Price Index (February), S&P Case Shiller Home Price Index (March), Consumer Confidence (April).

8. Companies reporting today per TipRanks: AM - American Tower (AMT) , Armstrong World (AWI) , BP (BP) , Coca-Cola (KO) , General Motors (GM) , JetBlue (JBLU) , Kimberly-Clark (KMB) , Paccar (PCAR) , Pentair (PNR) , Polaris Industries (PII) , Sherwin-Williams (SHW) , Sysco (SYY) , UPS (UPS) . PM - A10 Networks (ATEN) , Bloom Energy (BE) , Booking Holdings (BKNG) , Caesars Entertainment (CZR) , F5 Networks (FFIV) , Ingersoll-Rand (IR) , Logitech (LOGI), Mondelez (MDLZ) , NXP Semi (NXPI) , Omega Healthcare (OHI) , Robinhood (HOOD) , Starbucks (SBUX) , T-Mobile (TMUS) , Visa (V) , Waste Management (WM) , Welltower (WELL) .

At the time of publication, TheStreet Pro Portfolio was long AMZN, GOOGL, META, MSFT, WELL, and WM.