Cautious Optimism. A week ago, the Nasdaq Composite was still firmly in correction territory. Today, the tech-heavy index completed its longest winning streak in nearly two decades.

The Nasdaq has risen in 12 straight sessions, marking its longest stretch of consecutive gains since July 23, 2009, according to Dow Jones Market Data. The index gained 0.4% on Thursday.

The S&P 500 and Russell 2000 also set new highs today, up 0.3% and 0.2%, respectively. The Dow Jones Industrial Average rose 114 points, or 0.2%.

A few headlines fueled the rally. President Donald Trump said that Israel and Lebanon had come to a 10-day truce, which could bring some more stability to the region.

A solid first-quarter earnings season was helping, too. Consensus estimates predict that earnings per share will grow by about 13% year over year in the first quarter, and, so far, companies are delivering.

Just don’t mistake the current rally for a case of total investor amnesia. Even though three indexes notched records today, the overall gains were fairly modest. Markets seemed to be taking a breather to decide just how risk-on to get—and that’s probably a good thing.

“It’s not the time to be full-on risk—it’s the time to have some dry powder,” said Jim Masturzo, chief investment officer of Research Affiliates. “There’s a good chance there’ll be another leg down, and that’s when you want to deploy your capital.”

In Masturzo’s view, markets may be over-appreciating the fact that the cease-fire is holding and negotiations are ongoing, reducing the likelihood of renewed hostilities. But, he notes, markets are probably under-appreciating how long it will take to fix the damage done to global supply chains—and the problems that could arise if stockpiles of oil, fertilizer, and other commodities run low.

“Cautious optimism is fine,” Masturzo said. “But I think the market has gone to optimism squared, and I think we are a little bit out over the skis at this point.”

The Hot Stock: Albemarle +16.3%
The Biggest Loser: Charles Schwab -7.6%

Best Sector: Energy +1.6%
Worst Sector: Healthcare -0.8%

Robert F. Kennedy Jr. is making the rounds on Capitol Hill this week. He testified in front of two House budget committees on Thursday and has five more meetings to go. Kennedy is trying to sell Congress on a 12.5% cut to the U.S. Department of Health and Human Services budget to refocus its aims on Make America Healthy Again goals while trimming down “bloated, woke, and inefficient programs.”

At his first appearance of the House Ways and Means Committee, he told lawmakers that HHS has delivered “historic wins” so far, including negotiating most favored nation drug pricing with 16 large pharmaceutical companies, bringing health insurance CEOs “to the table to reform prior authorizations,” and $50 billion investment in a rural health transformation, reports my colleague Catherine Dunn.

Just yesterday, he proclaimed the government would loosen regulations for 12 peptides that were previously banned for use in compounding pharmacies, or pharmacies that mix ingredients to create personalized prescriptions. RFK has long touted the use of peptide injections, and the move is a big win for the MAHA agenda.

The announcement sent shares of Hims & Hers surging, closing 14% higher on Wednesday and 11% higher on Thursday.

The telehealth firm made a name for itself in offering weight-loss drugs on a compounded basis. The company has since “signaled its plans to explore different types of peptides through the acquisition of a California-based manufacturing facility in February,” writes my colleague, Mackenzie Tatananni. Those likely include peptides such as BPC-157, TB-500, and MOTs-C, which are said to enhance strength, energy, and recovery and have become fixtures in the fitness community.

The FDA still has to sign on, though. The Pharmacy Compounding Advisory Community plans to evaluate the use case of each substance in late July. Until then, “Hims can’t bring peptides to market just yet, and plenty of questions will remain once the re-evaluation process begins,” Mackenzie notes.

Ericsson, Fifth Third Bancorp, Regions Financial, State Street, and Truist Financial release earnings tomorrow.

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