(P1) The S&P 500 notched a 1% gain to log its highest close since the Iran conflict began, extending its winning streak to eight sessions even as a U.S. blockade of the Strait of Hormuz sent oil prices surging.
(P2) "We’ll continue to pay attention to it, but try not to get too optimistic or pessimistic based on the latest headline,” said Tim Holland, the chief investment officer at Orion, reflecting a market parsing corporate earnings amid the geopolitical turbulence.
(P3) The tech-heavy Nasdaq Composite rose 1.2% for its longest winning streak since 2023, while the Dow Jones Industrial Average gained 0.6% to move into positive territory for the year. The rally was powered by software companies, with Oracle rising over 12% and Adobe recording its largest percent increase in a year, pushing the iShares Expanded Tech-Software Sector ETF up around 5.4%.
(P4) The market's muted reaction to the blockade suggests investors are looking past the immediate conflict toward long-term fundamentals, betting that the disruption will not be enough to derail the broader economy or corporate profitability, particularly in resilient sectors like technology.
A surge in software stocks helped indexes open the week with gains Monday despite the U.S. blockade of the Strait of Hormuz, the latest Middle East development to test investors’ tolerance for risk. The blockade, which began Monday morning, will choke off the flow of roughly two million barrels a day of crude that Tehran has been exporting.
The move immediately rippled through energy markets. Brent crude, the international oil benchmark, added 4.37% to close at $99.36 a barrel. The price of physical crude oil cargoes for prompt delivery to Europe hit a record high of nearly $150 a barrel, though futures indicated that traders were less concerned about supply stress persisting late into the year.
In equity markets, investors appeared to focus on fundamentals. Tech stocks led gains in the S&P 500, with the information-technology sector rising around 1% to its highest value since the war with Iran began. Scott Ladner, chief investment officer at Horizon Investments, said that after an initial selloff, investors have learned to differentiate between the winners and losers of the AI age.
“Now we’re getting to a place where analysts have had time to look at the individual software companies and say, ‘I like this one, I don’t like that one,” Ladner said. Some of Monday’s winners included ServiceNow, which climbed more than 7%, alongside Oracle and Adobe.
This article is for informational purposes only and does not constitute investment advice.
