Earnings poised to stoke confidence in a stock market that has rebounded to all-time highs. Here’s what’s ahead
Just as earnings season revs into full gear, the bulls have taken hold of Wall Street amid growing hopes the U.S.-Iran war will soon end. The S & P 500 and Nasdaq Composite rallied to all-time highs not breached since January this week on news that Iran will reopen the Strait of Hormuz for the duration of the ceasefire between Israel and Lebanon, the latest sign of a deescalation of tensions in the Middle East. Adding to hopes of a forthcoming peace agreement were President Donald Trump ‘s comments that talks should progress “very quickly” given that most of the points are “already negotiated.” Those fast-moving developments add to confidence in many parts of the Street that the bottom is in for equities. This optimistic view has helped curb the stock market’s losses over the past month, and now suggests equities can resume their climb. “Markets have turned the corner from the drawdown to be more flattish,” said David Miller, investment chief at Catalyst Funds. “I think we’re in a pretty healthy place.” .SPX YTD mountain S & P 500, YTD On Friday, the S & P 500 and the Nasdaq Composite breached fresh intraday all-time highs, with the broader index topping 7,100 for the first time ever. The Dow Jones Industrial Average soared more than 900 points. On the other hand, oil tumbled to around $80 a barrel , far below the $110 a barrel it peaked at during the worst of the conflict. Moving on It’s clear that investors are ready to move on. First-quarter earnings season is expected to give the stock market an opportunity to confirm investors’ most bullish views of the economy. The S & P 500 is expected to post a blended growth rate of 12.5% in the first quarter, according to FactSet data. Thus far, only 32 companies in the index have reported, with 78% beating expectations. Next week will bring a succession of earnings reports from companies representing a broad swath of sectors, including airline stocks such as United Airlines , defense names such as Lockheed Martin and RTX , and semiconductors such as Lam Research . IBM , Boeing , Blackstone , GE Vernova and Tesla are among some other notable names. Yet, there remain plenty in and outside of Wall Street who warn against underestimating the conflict — and how much it has disrupted global supply chains — saying the market has thus far been too complacent in the face of steep macroeconomic risks if the U.S.-Iran war drags on longer than investors suspect. That’s why it will be critical to see whether the ceasefire holds and if Iran’s declaration that the Strait of Hormuz is open truly gets oil and other goods flowing through the critical waterway again. To be sure, ships still need to coordinate their transit with Iranian forces, and the U.S. has said its naval blockade is still in force. @CL.1 1M mountain West Texas Intermediate Crude oil “The equity market’s rapid 12-day transition from oversold to overbought masks a precarious macro reality, especially given the ongoing threat of crude oil above $90/barrel,” wrote Craig Johnson, chief market technician at Piper Sandler. “The mixed signals from short-term strength and lagging intermediate breadth create a highly fragile technical foundation for the stock market as it climbs into all-time high territory,” Johnson added. “Investors should remain highly selective and focus on quality set-ups.” Week ahead calendar All times ET. Monday, April 20 Earnings: Steel Dynamics Tuesday, April 21 8:15 a.m. ADP Weekly Employment change (04/04) 8:30 a.m. Retail Sales (March) 10:00 a.m. Business Inventories (February) 10:00 a.m. Pending Home Sales (March) Earnings: Capital One Financial , Interactive Brokers Group , United Airlines , Intuitive Surgical , Tractor Supply , RTX , Genuine Parts , Halliburton , 3M , Equifax , Synchrony Financial , Danaher , UnitedHealth Group , Northern Trust , Northrop Grumman , GE Aerospace , D.R. Horton , Quest Diagnostics Wednesday, April 22 Earnings: United Rentals , Raymond James Financial , Crown Castle , ServiceNow , International Businesses Machines , Lam Research , Kinder Morgan , Texas Instruments , CSX , Tesla , Packaging Corporation of America , Southwest Airlines , Boeing , Philip Morris International , CME Group , Boston Scientific , Elevance Health , Vertiv , Teledyne Technologies , AT & T , Otis Worldwide , GE Vernova Thursday, April 23 8:30 a.m. Initial Claims (04/18) 9:45 a.m. S & P Global PMI Manufacturing preliminary (April) 9:45 a.m. S & P Global PMI Services preliminary (April) Earnings: Baker Hughes , Ameriprise Financial , Verisign , Newmont , Digital Realty Trust , Intel , Principal Financial Group , Hartford Insurance Group , Edwards Lifesciences , Union Pacific , Nasdaq , Dover , American Express , Roper Technologies , CBRE Group , Snap-On , West Pharmaceutical Services , Thermo Fisher Scientific , PG & E , Honeywell International , Dow , PulteGroup , NextEra Energy , Lockheed Martin , Keurig Dr. Pepper , Huntington Bancshares , Freeport-McMoRan , CenterPoint Energy , Comcast , Blackstone Friday, April 24 10:00 a.m. Michigan Sentiment final (April) Earnings: SLB , Procter & Gamble , Charter Communications , Norfolk Southern — CNBC’s Yun Li contributed to this report.