Strait Opens, S&P 500 Hits All-Time High as War Rally Peaks

U.S. equity markets completed a stunning three-week, 13-day rally that transformed a war-induced correction into a string of all-time records. The S&P 500 surged +3.07% for the week, closing at a new all-time high of 7,126.06 : its first-ever close above 7,100. The Nasdaq Composite posted its 13th consecutive winning session, its longest streak since 1992, gaining +6.84% for the week. The Russell 2000 also hit a new all-time high of 2,776.90, up +5.56% on the week and now +10.89% year-to-date. Every major index is now positive for 2026.

The catalyst that broke the war premium for good arrived Friday morning when Iran’s Foreign Minister declared the Strait of Hormuz “completely open” to commercial shipping for the duration of the Lebanon–Israel ceasefire. WTI crude plunged 14% on the day alone, closing at $82.59/barrel : its worst weekly performance since April 2020. Cruise lines led all stocks: Royal Caribbean, Norwegian, and Carnival each surged more than 9%. Consumer discretionary became the week’s top-performing S&P 500 sector at +2.5% on Friday alone.

Q1 Earnings Beat with One Notable Miss

Major banks dominated the early earnings season and delivered. Goldman Sachs, JPMorgan, Bank of America, Morgan Stanley all reported Q1 results that beat estimates, with trading revenue a standout as volatility provided opportunities throughout the war period. TSMC reported Q1 earnings Thursday and boosted its 2026 sales outlook, citing “extremely robust” AI demand : but shares dipped modestly as the upbeat guidance was already priced in. The week’s biggest surprise came from Netflix, which fell 10% after weak Q2 guidance disappointed investors despite solid Q1 results, with co-founder Reed Hastings announcing his planned departure from the board.

Yields Fall, Dollar Weakens, Gold Rises

The 10-year Treasury yield fell to 4.26% : its lowest since early March : as energy-driven inflation fears eased. The U.S. Dollar Index slipped to a one-month low near 98.20. Gold closed at $4,879/oz, its fourth consecutive weekly gain, up +2.3% for the week and still up 23% from its war-period lows as geopolitical uncertainty lingers. The Fed meets April 28–29; markets have now priced in one rate cut for 2026, likely in the second half of the year as the energy-driven CPI spike is expected to partially reverse in April data.

Markets Digest Jobs Beat, CPI, and Iran's Next Move

The rally has been extraordinary : 13 straight Nasdaq wins, S&P 500 at a new all-time high, oil below $83 : but the week ahead will test whether the move has legs. The Federal Reserve meets April 28–29, and for the first time in months, the inflation picture is improving: oil has pulled back sharply, and the energy-driven CPI spike looks transitory. Markets now expect one cut in 2026. The key question is whether Chair Powell signals any willingness to move sooner.

Mon–Tue Apr 20–21: Tesla & Mag-7 Earnings Begin

Tesla reports Q1 earnings Monday after the close : the first Magnificent Seven name this season. The EV maker had a rough Q1 deliveries miss (358,023 vs. 366,000 expected), so guidance will be critical. Alphabet (Google) also reports this week, with AI infrastructure spending commentary the key focus. Any weakness in Mag-7 after such a strong rally could trigger profit-taking.

Wed Apr 22: Flash PMIs & Existing Home Sales

April’s flash S&P Global PMIs are the first economic data to capture any post-ceasefire consumer and business mood improvement. Existing Home Sales data also prints : mortgage rates have dropped with the 10-year yield’s decline to 4.26%, which could provide early signs of spring housing demand recovering.

Thu Apr 24: Jobless Claims & More Earnings

Weekly jobless claims will be watched closely for any labor market ripples. With the war winding down and fuel surcharges easing, transport and retail sectors may show early stabilization. Visa, PepsiCo and other consumer-facing companies report, providing the first real-world read on how consumers behaved during the conflict’s peak weeks.

Gold at $4,879/oz and the VIX at 17.48 both signal that markets are pricing in a durable peace, but the U.S. naval blockade remains in place pending a formal deal. Any reversal on the Strait : or a hostile headline from Islamabad Sunday talks : could rapidly unwind the rally. The S&P 500’s new all-time high of 7,126 is the target to defend.