Talk’s Not Cheap. A continued flow of peace talk is bringing new hope to the world—and a boost to stocks. After Iran said this morning that the Strait of Hormuz was once again open to commercial traffic, stocks jumped and oil tumbled. It’s a continued reversal of the war trade that had pummeled stocks and sent oil past $100 a barrel. Airlines, cruise companies, and other travel stocks jumped on today’s news.

Now the Nasdaq Composite is back at record highs, and oil is down near $80. Today alone, West Texas Intermediate crude fell $10.84 a barrel, or 11.4%.

The Nasdaq was up for a 13th straight session, matching its longest winning streak since 1992. It rose 1.5% today and 6.8% on the week, closing Friday at a record. The broader S&P 500 also closed at record levels, though its weekly gain was muted by comparison, at 4.5%. The Dow Jones Industrial Average rose 1,531 points, or 3.2%, on the week.

To be sure, geopolitics can only take the market so far. Much of the latest gains can be chalked up to a solid start to earnings season. So far, about 10% of the S&P 500 has reported first-quarter results—and 88% of those earnings have bested Wall Street estimates, according to FactSet. Companies beat earnings estimates more often than not, but the current pace is particularly impressive. Over the last 10 years, that rate of beats has averaged 76%, per FactSet.

The biggest reports are still to come, though. All of the Mag 7 companies, excluding Nvidia, will report next week and the week after. Their results could determine whether the latest rally has legs.

The Hot Stock: Royal Caribbean Group +7.3%
The Biggest Loser: LyondellBasell Industries -12.0%

Best Sector: Consumer Discretionary +2.0%
Worst Sector: Energy -2.9%

Roughly 90 S&P 500 companies are set to report earnings next week. Capital One Financial, Danaher, GE Aerospace, RTX, and UnitedHealth Group report on Tuesday. AT&T, Boeing, IBM, Lam Research, Philip Morris International, ServiceNow, Tesla, and Texas Instruments announce results on Wednesday, followed by American Express, Comcast, Honeywell International, Intel, Lockheed Martin, NextEra Energy, and Union Pacific on Thursday. HCA Healthcare, Norfolk Southern, and Procter & Gamble close out the week on Friday.

Economic data out next week include retail sales via the Census Bureau on Tuesday and S&P Global’s Manufacturing and Services Purchasing Managers’ Indexes on Thursday.

—Dan Lam

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Join Barron’s Live on Monday at noon. The bull market still deserves the benefit of the doubt says Keith Lerner, chief investment officer and chief market strategist at Truist Advisory Services. He ultimately sees a “choppy” path higher for stocks. Barron’s Lauren R. Rublin and Al Root talk to Keith about the outlook for stocks, bonds, and gold, and the industry sectors best positioned to outperform.

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