US stocks continue to make fresh daily highs and have erased the Iran war decline. It's an impressive turnaround given that just three days ago, JD Vance was walking away from negotiations in Pakistan.
The market quickly realized that was more of a stunt than a sign of the way that things are going. The ceasefire is continuing and Trump has stopped with the constant threats and is instead highlighting only nuclear as a problem and the market thinks the differences will be bridged and the oil will flow again.
The S&P 500 is up 1.1% today after trading near flat at the open. The biggest gainers are the airline stocks, led by a 7.9% rise in American Airlines. It's a double boost for that sector today as oil prices are falling and there is a report that United is thinking about a merger with American, and that US regulators are open to consolidation in the airline space.
Other travel names are also running with Expedia up 4.8% and Norwegian Cruise Lines up 4.7%
Another big winner today is Amazon, up 4.9%. Look at the snap comeback on the chart. It started April 9 on a report that it could sell its chips to other companies but the real tell was in the technicals as it broke above the March high and rose into the gap. This is impressive stuff.
Another space that's doing well today is memory chips. This has been a real battleground lately with some brutal volatility. Micron Technologies is up 6.7% today and is completing a round trip that saw it crushed down to $311 in March from a high of $471. The market is unsure how sustainable memory demand will be as new AI models tweak their requirements. Micron trades at around 10x earnings but the market isn't sure the earnings will last as memory companies have a long history of building capacity and crushing margins.
Other gainers today include financials after good results from Citigroup. That company is up 3.4% and above pre-war levels. The Mag 7 names are generally strong with Google up 3.6%, META up 4.8% and Tesla up 3.6%.
Much of the price action looks like investors cycling back into their favorite names, or leveraging back up.
Among the weaker names are oil companies with Chevron down 3.3% and back to pre-war levels. That's another sign that the market doesn't think that high oil prices will last.
This article was written by Adam Button at investinglive.com.