Stock Market Update

[BRIEFING.COM] The stock market started the week on a solid note, with the major averages trading higher throughout the session as tech leadership, broadening strength, and an intraday pullback in oil prices helped offset opening weakness tied to weekend geopolitical headlines. Today's steady upward climb pushed the S&P 500 back into positive territory for the year, and saw the index reclaim all of its losses since the start of the war in Iran.

The S&P 500 (+1.0%), Nasdaq Composite (+1.2%), and DJIA (+0.6%) opened to broad losses on the heels of the U.S. and Iran failing to agree to a more durable ceasefire this weekend. Additionally, President Trump announced a blockade of all ships entering and leaving Iranian ports.

However, the early losses quickly began to fade, suggesting that the market remains confident that a potential end to the conflict could be imminent and that it will spur a sharp upward move across equities.

This afternoon, CNN reporter Alayna Treene posted on X that the Trump administration is discussing "a potential second, in-person meeting with Iranian officials before the ceasefire between Washington & Tehran expires next week," reinforcing hopes for a near-term off-ramp.

The major averages were supported by a strong showing from the information technology sector (+1.3%), which was one of the first S&P 500 sectors to move into positive territory this morning. Software stocks garnered a strong buy-the-dip rebound from Friday's selloff that came amid renewed fears of AI disruption. Oracle (ORCL 155.64, +17.54, +12.71%) was the top-performing S&P 500 component today, and the iShares GS Software ETF finished 5.4% higher.

Microsoft (MSFT 384.37, +13.50, +3.64%) was a mega-cap standout amid a solid session for the market's heavyweights, which pushed the Vanguard Mega Cap Growth ETF 1.5% higher.

The financials sector (+1.7%) was the other notable outperformer in today's session, supported by broad strength that saw only Goldman Sachs (GS 890.79, -17.01, -1.87%) finish in negative territory. The company topped earnings estimates, but succumbed to some "sell the news" pressure after an impressive run-up to its earnings report over the last month. However, the company's record performance in Global Banking & Markets, combined with industry-leading M&A and equity underwriting activity, signals a meaningful rebound in capital markets and advisory demand, a positive read-through for peers as earnings season unfolds.

Elsewhere, the consumer discretionary (+0.9%) and communication services (+0.8%) sectors notched similar gains as mega-cap stocks charted fresh highs throughout the afternoon.

Only the defensive utilities (-1.2%) and consumer staples (-1.0%) sectors finished lower. Conagra (CAG 14.51, -0.67, -4.41%) was one of the worst-performing S&P 500 names after announcing that CEO Sean Connolly will step down on May 31, 2026, with John Brase set to take over as President and CEO effective June 1.

While the energy sector (+0.3%) managed a modest gain, it retreated sharply from its earlier highs in tandem with oil prices. WTI crude oil reached an overnight high of around $105 per barrel, but crude oil futures settled today's session $2.42 higher (+2.5%) at $98.97 per barrel.

Outside of the S&P 500, the Russell 2000 (+1.5%) outperformed as the market leaned into a risk-on tone throughout the session, while the S&P Mid Cap 400 (+1.1%) captured a gain similar to that of the major averages.

Today's action underscores the enthusiasm across the market that has pushed the major averages considerably higher over the past two weeks. Oil prices are stabilizing, and the mega-caps are reasserting their leadership, which has quickly negated losses incurred since the start of the Iran war. While volatility in oil prices will likely continue to cause price swings in the near term, the market's resilience highlights a willingness to look past near-term macro developments as the Q1 earnings season ramps up.

U.S. Treasuries began the week with modest gains across the curve as the market maintained some overall optimism even though U.S.-Iran negotiations failed to produce a peace deal over the weekend. The 2-year note yield settled down two basis points to 3.78%, and the 10-year note yield settled down two basis points to 4.30%. 

• S&P Mid Cap 400: +7.8% YTD
• Russell 2000: +7.6% YTD
• S&P 500: +0.6% YTD
• DJIA: +0.3% YTD
• Nasdaq Composite: -0.3% YTD

Reviewing today's data:

• Existing home sales decreased 3.6% month-over-month in March to a seasonally adjusted annual rate of 3.98 million (Briefing.com consensus 4.01 million) from an upwardly revised 4.13 million (from 4.09 million) in February. Sales were down 1.0% on a year-over-year basis.
  
  • The key takeaway from the report is that existing home sales were pressured at the start of the peak selling period by higher mortgage rates, higher prices, limited inventory, lower consumer confidence, and softer job growth.