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Google (GOOG/GOOGL) reported 1Q25 earnings after the close Thursday. I think Gene Munster is right in characterizing the quarter as “good but not great” as Search Revenue growth continues to decelerate. Nevertheless, with the stock beat down over the last couple months, it appears to be good enough and shares are currently +5-6% in the premarket.

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As a result it appears that the S&P will break out of the range defined by the April 9 candle when Trump paused his tariffs for 90 days in the middle of the trading session leading to a historic ramp higher. That range has contained all trading since then but it looks like the S&P will breakout to the upside today.

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If that plays out, it suggests to me that a good analogy for the current environment may be 1998. The market peaked in mid-July 1998 and accelerated to the downside at the end of August as Russia devalued the ruble and defaulted on its debt. This led to problems at the hedge fund Long Term Capital Management which was so leveraged that Greenspan concluded its failure could jeopardize the entire financial system and thus required a bailout.

When the Fed bailed out Long Term Capital Management, the market bottomed and continued higher for another year and a half until the top of the Dot Com Bubble in March 2000. The story of Long Term Capital Management is engagingly told by Roger Lowenstein in When Genius Failed: The Rise And Fall of Long Term Capital Management.

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