Stocks Extend Rally on Ceasefire Hopes, but Uncertainty Keeps Gains in Check

Stocks advanced for a second straight session to kick off the new quarter, as optimism surrounding a potential de-escalation in the U.S.–Iran conflict continued to support risk appetite. The S&P 500 rose 0.7%, the Nasdaq Composite gained 1.2%, and the Dow Jones Industrial Average added 0.5%, extending yesterday’s strong rebound.

The Dow briefly reclaimed its 200-day moving average during the session but failed to hold that level into the close, underscoring that key technical resistance remains firmly in place.

Futures had pointed to a higher open following a Bloomberg report indicating that President Trump is willing to wind down U.S. military involvement within two to three weeks, even without a finalized agreement. However, that optimism was tempered by subsequent rhetoric, including renewed threats targeting Iran’s infrastructure if the Strait of Hormuz remains closed.

Throughout the session, conflicting headlines continued to cloud visibility. Reuters reported that Iran denied requesting a ceasefire, while Israeli sources suggested negotiations are not progressing constructively. These developments triggered a midday pullback, though equities ultimately recovered into the close.

Markets are now focused on a scheduled evening address from President Trump, which Politico indicated could outline a path toward de-escalation and a potential drawdown in military operations.

Oil prices provided additional support for equities, declining for a second consecutive session. Crude settled down 1.0% at $100.14 per barrel and continued to drift lower after hours, easing some inflation-related concerns.

The pullback in oil weighed heavily on energy stocks, with the sector falling 3.9% as all components finished lower. Consumer staples also lagged, declining 0.6%, as investors rotated toward growth-oriented areas. Financials were mixed, ending the session roughly flat.

Leadership shifted back to mega-cap and growth stocks. The communication services sector rose 1.6%, supported by continued rebounds in Alphabet and Meta Platforms, both of which are recovering from last week’s legal-driven sell-off.

Technology also remained a key driver, with the sector gaining 1.1%. Semiconductor stocks were particularly strong, pushing the PHLX Semiconductor Index up 2.8%. Western Digital and Micron led the advance with outsized gains, offsetting lingering softness in software. Microsoft was the only major mega-cap name to finish slightly lower.

Consumer discretionary stocks added 0.9%, supported by broad participation and strength in large-cap components. However, NIKE was a notable laggard, plunging after issuing weak guidance despite an earnings beat.

In health care, Eli Lilly surged following confirmation that the FDA approved its new weight-loss drug, providing a boost to the sector.

Overall, the market maintained upward momentum despite intraday volatility, reflecting a willingness among investors to lean into signs of de-escalation—even as the geopolitical backdrop remains highly fluid. With major indices still below their 200-day moving averages, the rally remains technically constrained.

Attention now turns to tonight’s presidential address for clearer direction on U.S. involvement in the conflict. With the week shortened by the Good Friday market closure, tomorrow’s session will be the final opportunity for investors to position ahead of the long weekend.

Our FTinvest 11 model portfolio advanced 0.21% to close at 972.10, extending its recent rebound and building on yesterday’s strong gains. The portfolio continues to move higher after the March correction, though it remains below the all-time high of 1,039.51.

Based on the start-of-year level of 928.18, FTinvest 11 is now up approximately +4.73% year-to-date, reflecting steady recovery momentum heading into the new quarter. The portfolio’s consistent upward movement underscores the strength of its disciplined, value-driven approach as it regains traction.