On Friday, the S&P 500 Index ($SPX) (SPY) closed up +1.20%, the Dow Jones Industrial Average ($DOWI) (DIA) closed up +1.79%, and the Nasdaq 100 Index ($IUXX) (QQQ) closed up +1.29%. June E-mini S&P futures (ESM26) rose +1.20%, and June E-mini Nasdaq futures (NQM26) rose +1.28%.
Stock indexes closed sharply higher on Friday, with the S&P 500 and Nasdaq 100 setting new all-time highs and the Dow Jones Industrials setting a 7-week high. Stocks rose on Friday amid growing speculation that a deal could be reached to end the US-Iran war, boosting risk-on sentiment in asset markets. Crude oil prices fell more than -11% after Iran announced that the Strait of Hormuz is now “fully open” to commercial shipping, marking a major step towards ending the war with the US and Israel. Falling crude oil prices eased inflation concerns and the 10-year T-note yield declined by -7bp to 4.24%. Additionally, optimism about artificial intelligence and strong earnings have boosted stock market momentum.
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Shares also got support after Axios reported on Friday that the US and Iran are in talks on a plan to end the war, with one element under discussion being the US releasing $20 billion in frozen Iranian assets in exchange for Iran giving up its reserves of enriched uranium. Talks between America and Iran are expected to continue in Pakistan on Sunday or Monday.
President Trump claimed on Thursday that Iran has made significant concessions in ongoing talks to end the seven-week war. “They have agreed on almost everything, and they have to come to the table with a pen,” Mr Trump said. Mr Trump said he may visit Pakistan if a deal is reached with Iran. Prospects for a formal peace deal also strengthened when Israel and Lebanon agreed to a 10-day ceasefire on Thursday, and the truce appeared to be holding today.
WTI crude oil prices (CLK26) fell more than -11% to a 5-week low on Friday after Iran said the Strait of Hormuz is open to commercial shipping, which could pave the way for a deal to end the war. President Trump said that the US naval blockade of the strait “will continue in full force” until a deal is fully agreed upon. On Monday, the US vowed to block all ships passing through the strait that call on or visit Iranian ports. The blockade could worsen global oil and fuel shortages, as about a fifth of the world’s oil and liquefied natural gas passes through the strait. Iran has been able to export crude oil during the war, exporting about 1.7 million bpd in March.
San Francisco Fed Chair Mary Daly’s comments on Friday indicated she is in favor of keeping the Fed policy on hold, noting that the oil shock in the US is stronger in favor of inflation than growth, and leaving the policy unchanged would still restrain inflation.
Earnings season got off to a strong start this week, with 81% of the 48 S&P 500 companies reporting Q1 earnings that beat estimates. According to Bloomberg Intelligence, Q1 S&P 500 earnings are projected to rise +12% year-over-year. Excluding the technology sector, Q1 earnings are projected to grow about +3%, the weakest in two years.
Markets are discounting a +1% chance of a +25 bp FOMC rate hike at the April 28-29 policy meeting.
There was a mixed trend in foreign stock markets on Friday. The Euro Stoxx 50 hit a 7-week high and closed up +2.10%. China’s Shanghai Composite closed down -0.10%, falling from a 4-week high. Japan’s Nikkei stock closed down 225 -1.71%.
interest rates
June 10-year T-notes (ZNM6) closed at +16 ticks on Friday. The 10-year T-note yield fell -6.7bp to 4.244%. June T-notes hit a 1-month high on Friday, and the 10-year T-note yield fell to a 1-month low of 4.224%. WTI crude oil prices fell -11% on Friday to hit a 5-week low as inflation expectations fell and T-note prices rose. The 10-year breakeven inflation rate fell to a 1-week low of 2.346% on Friday.
European government bond yields edged lower on Friday. The 10-year German Bund yield fell to a 1-week low of 2.945% and eased -7.2bp to 2.960%. UK 10-year gilt yields fell to a 1-week low of 4.725% and fell -8.5bp to 4.762%.
“Risks to the price outlook are tilted to the upside, particularly in the near term, while the medium-term effects will depend on the intensity and duration of the war,” ECB President Christine Lagarde said.
ECB Governing Council member Madis Muller said the ECB needed to be “vigilant” about potential inflation risks from the Iran war, but “we don’t have much strong evidence of second-round effects, so it’s hard to argue that there is a clear case for raising rates.”
“Given the greater uncertainty at the moment, June is a better time than April” to decide whether an ECB interest rate response to the Iran war is necessary, said ECB Governing Council member Alexander DeMarco.
The swaps are discounting a 9% chance of a +25bp ECB rate hike at their next policy meeting on April 30.
US Stock Movers
Airline stocks and cruise line operators rose sharply on Friday as WTI crude oil prices fell more than -11%, pushing down fuel costs and boosting company profits. Alaska Air Group (ALK) closed up more than +10%, and Royal Caribbean Cruises Ltd. (RCL) closed up more than 7%, leading the S&P 500. Additionally, United Airlines Holdings (UAL) and Carnival (CCL) closed up more than +7%, and Norwegian Cruise Line Holdings (NCLH) closed up more than +5%. Additionally, Southwest Airlines (LUV) and American Airlines Group (AAL) closed up more than +4%, and Delta Air Lines (DAL) closed up more than +2%.
Magnificent Seven Technology shares rose on Friday, which is a supportive factor for the overall market. Tesla (TSLA) closed up more than +3%, and Apple (AAPL) closed up more than +2%. Additionally, Alphabet (GOOGL), Nvidia (NVDA), and Meta Platform (META) closed up more than +1%. Additionally, Microsoft (MSFT) closed up +0.60%, and Amazon.com (AMZN) closed up +0.34%.
Chipmaker and AI-infrastructure stocks rose on Friday to provide support to the broader market. Analog Devices (ADI) and Marvell Technology (MRVL) closed up more than +4%, and ASML Holdings NV (ASML), Seagate Technology Holdings PLC (STX), and KLA Corp (KLAC) closed up more than +3%. Additionally, Western Digital (WDC), Microchip Technology (MCHP), ARM Holdings PLC (ARM), Lamm Research (LRCX), and Texas Instruments (TXN) closed more than +2%.
Cryptocurrency-exposed stocks moved higher on Friday as Bitcoin (^BTCUSD) rose more than +3% to a 2.5-month high. The Strategy (MSTR) closed the day leading the Nasdaq 100 with gains of more than +11%. Additionally, Riot Platforms (RIOT) closed with gains of over +7%, and Galaxy Digital Holdings (GLXY) closed with gains of over +6%. Additionally, Coinbase Global (COIN) closed up over +3%, and MARA Holdings (MARA) closed up over +1%.
Energy stocks and service providers declined on Friday as WTI crude oil fell more than -11% to a 5-week low. Valero Energy (VLO) closed up more than -7% and APA Corp (APA) closed up. Occidental Petroleum (OXY) and Marathon Petroleum (MPC) closed down more than -5%. Additionally, ConocoPhillips (COP) and Phillips 66 (PSX) closed down more than -4%, and Diamondback Energy (FANG), Devon Energy (DVN), and Exxon Mobil (XOM) closed down more than -3%. Additionally, Halliburton (HAL) closed down more than -2%, and Chevron (CVX) closed down more than -2% to lead the decline in the Dow Jones Industrials.
Onto Innovation (ONTO) closed up more than +8% after Stifel upgraded the stock to buy from hold with a $350 price target.
Ally Financial (ALLY) closed up more than +7% after reporting Q1 adjusted EPS of $1.11, better than the consensus of 93 cents.
Autoliv (ALV) closed up more than +6% after reporting Q1 sales of $2.75 billion, above the consensus of $2.61 billion.
Woodward Inc. after RBC Capital Markets initiated coverage on the stock with an Outperform recommendation and a $450 price target. (WWD) closed up more than +5%.
Netflix (NFLX) closed down more than -9% to lead the Nasdaq 100 as a loser after estimating second-quarter revenue of $12.57 billion, below the consensus estimate of $12.64 billion.
Albemarle (ALB) closed down more than -8% after Baird downgraded the stock to Neutral from Outperform.
Alcoa (AA) closed down more than -7% after reporting first-quarter sales of $3.19 billion, falling short of the $3.27 billion consensus.
Earnings Report(4/20/2026)
AGNC Investment Corp (AGNC), Alaska Air Group Inc (ALK), BOK Financial Corp (BOKF), Cleveland-Cliffs Inc (CLF), Steel Dynamics Inc (STLD), Wintrust Financial Corp (WTFC), Zions Bancorp NA (ZION).
On the date of publication, Rich Asplund did not have (directly or indirectly) any positions in any securities mentioned in this article. All information and data in this article is for informational purposes only. Please see the Barchart Disclosure Policy here for more information.
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