Relief Rally Follows Ceasefire, But Risk Remains

Published as of: April 8, 2026, 9:12 a.m. ET

(Wednesday market open) Stocks surged, crude oil prices plunged to below $94 a barrel, and Treasury yields dove this morning after President Trump announced he's suspending attacks on Iran for two weeks. The deal also includes a promise by Iran to reopen the Strait of Hormuz, temporarily ending a chokehold that sent oil prices to four-year highs. Markets priced in a fast unwinding of the geopolitical risk premium, but real-world shipping and inventory normalization take time. The question is whether improved headlines translate into durable, verifiable normalization in real-world supply flows. Any renewed disruption of the strait could send crude prices right back up.

"The significant futures rebound on the ceasefire deal is reminiscent of nearly exactly one year ago when 'Liberation Day' reciprocal tariffs were delayed," said Liz Ann Sonders, chief investment strategist at the Schwab Center for Financial Research (SCFR). "Given that bombing is still underway in the region, it's likely too soon to assume calm waters (literally and figuratively) over the next two weeks. More than 800 container ships remain stuck inside the Gulf. Bottom line—this doesn't appear to be 'over.'"

In trading yesterday before the ceasefire news, major indexes mostly recovered from sharp declines to post light gains on hopes of an end to the conflict. Returning to today's ceasefire reaction, market leadership appears concentrated in cyclical groups like consumer discretionary, info tech, and communication services that often thrive in a growing economy. Meanwhile, odds jumped to 45% of at least one Federal Reserve rate cut before year-end as inflation fears eased, according to the CME FedWatch Tool. Chances of a hike—which simmered during the heat of the conflict—retreated to less than 1%. There's still about a 99% chance the Fed stays paused later this month, and rate cut odds would likely fall quickly if the ceasefire breaks. 

1. Where does focus go if war clouds scatter? With the war on hold at least for now, investor attention likely returns to the same fundamentals from before the war, said Nathan Peterson, director of derivatives research and strategy at SCFR. These include the AI growth story, improved corporate earnings forecasts, and the solid March jobs data. One company enjoying an immediate tailwind from the Iran news is Delta Air Lines (DAL). Shares popped more than 12% in early trading after the company's earnings beat estimates and crude oil fell dramatically, possibly reducing one of the company's largest costs. CEO Ed Bastian told CNBC that the company hit guidance for the first quarter despite fuel price increases and premium cabin demand is up double digits. Other airline stocks, including United Airlines (UAL), also climbed double digits in the early going. Beyond airlines, the suspension of conflict appeared most helpful at least initially to memory chip makers, cruise lines, mining firms, and crypto-related stocks.
    
2. Price fears ramp before data: Even with the war on hold and crude oil down, inflation worries percolate heading into key data early tomorrow. The prices paid components for both the ISM Manufacturing PMI^® and ISM Services PMI^® last month reached their highest readings since 2022. Services prices posted their largest one-month increase in more than 13 years, while manufacturing prices indicated that raw material costs continue to rise. Adding to concerns, the services report showed a drop in employment. This puts the Federal Reserve in a tough place trying to address both weak jobs growth and rising prices. A broader look at inflation arrives at 8:30 a.m. tomorrow with February's Personal Consumption Expenditures (PCE) price index. The core PCE price index, which excludes volatile food and energy prices, rose 3.1% year over year in January, its highest level in nearly two years—and that was well before the war started. For February monthly PCE, analysts expect 0.4% headline growth and 0.3% core, according to Briefing.com. That's not changed much from January but doesn’t reflect data from after the war when oil prices spiked. With that in mind, investors might discount the report to some extent.
    
3. Earnings guidance might be "murky": Delta's earnings today arguably ring a bell reminding investors that the flight is boarding for earnings season to take off next week. How much companies can say about the near future, given so many questions about oil prices, the rising costs of other goods, and the Middle East conflict may affect their ability to deliver estimates for coming quarters. "I think the guidance is going to be murkier this earnings season," Sonders said in an interview with CNBC yesterday before the ceasefire announcement. "Analysts will undoubtedly be probing companies about how the vagaries of energy prices and supply disruptions are playing into the cost side of their equations and how they are adjusting to those realities." Even with today's news, crude oil prices remain elevated well above pre-war levels and the course of the conflict after this two-week lull isn't clear, which may work into companies' reluctance to look too far ahead.

• Micron (MU) surged 9% ahead of the open and other stocks related to memory chips also got a boost on the suspension of conflict. These stocks had been coming back from recent weakness and appeared to get a fresh boost from hopes that the global economy could be helped if fighting diminished.
   
• Norwegian Cruise Line (NCLH) and Royal Caribbean (RCL) rose 9% and 8%, respectively, ahead of the open. Fuel is a big cost for these companies, and a strong global economy is helpful for cruising demand.
   
• Along with airlines and cruise lines, the tech sector appeared to gain most from the ceasefire agreement early today. Worries about global shipping interruptions, fuel costs, and supply shortages had dogged this sector throughout the war. Some shares gaining today included ASML (ASML) up 7.8%, Applied Materials (AMAT) up 6.8%, CoreWeave (CRWV) up almost 7%, and Taiwan Semiconductor Manufacturing (TSM) up 6%.
   
• Crypto-related stocks including Circle Internet Group (CRCL) and Strategy (MSTR) rose 6% or more early today as bitcoin (/BTC) jumped 4% following the ceasefire agreement. Rising crypto prices often go hand in hand with risk-on sentiment in the market.
   
• Gold prices (/GC) climbed 2.8% in the early going, helping lift mining shares. Freeport-McMoRan (FCX) jumped 6% and Newmont (NEM) rose nearly 6%. Silver was much higher, up more than 7%. Metals prices had sagged during the war, in part as rate hike odds climbed around the world, but also on concerns about economic demand.
   
• Energy stocks took a hit from falling crude oil today. Some companies losing ground included ConocoPhillips (COP) down 6%, Exxon Mobil (XOM) down 5.7%, Valero Energy (VLO) down 5%, and Chevron (CVX) down 5%.
   
• Apple (AAPL) fell more than 2% Tuesday following a media report about manufacturing problems possibly leading to shipment delays of its foldable iPhone. In addition, UBS reported that its analysis of app store growth was 7% in March, weighed down by relatively flat U.S. growth. Shares jumped 2% early today.
   
• Technically, the S&P 500 Index was on pace to surpass its 200-day moving average of 6,655 as of today's open. The 50-day moving average of 6,771 is another level to watch. The Nasdaq-100^® (NDX) is on pace to open above its 200-day moving average of 24,472 and move toward its 50-day of 24,720.
   
• The Cboe Volatility Index (VIX) dropped sharply to around 20 early today, near the historic average. This looks like what traders call a "de-risking" unwind consistent with a relief rally, but it doesn't mean risk is gone, just that the market is paying less for immediate disaster insurance.
   
• Constellation Brands (STZ) climbed more than 2% before reporting after today's close. Its earnings call is tomorrow morning.
   
• Treasury yields fell a sharp 10 basis points early today for the 10-year note on easing oil price concerns. Yesterday's 3-year note auction saw strong demand, Briefing.com noted. A 10-year note auction comes later this morning, with results due by early afternoon.

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While the S&P 500 Index (not shown) continues pursuing its 200-day moving average after two weeks below it, the Russell 2000 Index^® (RUT—candlesticks) of small-cap stocks topped its 200-day average (blue line) last week after briefly falling below it, and is now knocking on the door of its 100-day moving average (red line). A move above that might be seen as supportive for the S&P 500. Small-cap stocks tend to be more responsive to the domestic U.S. economy because of their higher exposure there, and to interest rates because smaller firms often rely more on borrowing.

Check out the investors' calendar for a summary of the top economic events and earnings reports on tap this week.

April 9: Fourth quarter GDP-third estimate, February PCE prices.
April 10: March CPI, March core CPI, preliminary April University of Michigan Consumer Sentiment.
April 13: Expected earnings from Goldman Sachs (GS), March existing home sales.
April 14: March PPI, March core PPI, and expected earnings from JPMorgan Chase (JPM), Johnson & Johnson (JNJ), Wells Fargo (WFC), Citigroup (C), BlackRock (BLK).
April 15: Expected earnings from ASML (ASML), Bank of America (BAC), Morgan Stanley (MS), Progressive (PGR), PNC Financial (PNC), and JB Hunt Transport (JBHT).