S&P 500 and Nasdaq record highs returned on Wednesday as Wall Street pushed past worries about rising oil prices. The move reverses last month’s pattern, when higher crude prices pulled stocks down sharply. Since March 30, the S&P 500 has climbed more than 12% from its recent low. The Nasdaq jumped over 18% during the same period, showing a powerful stock market rally.
The S&P now sits nearly 4% above its level when the war began. Nasdaq gained close to 9% across the same window, lifted by renewed buying interest. Investors look forward, betting that the oil shock will fade before hurting economic growth. Optimism around corporate earnings season keeps pushing traders deeper into risk assets this week.
Tech stocks’ rebound fuels the fresh surge
Tech stocks slumped earlier this year over concerns about high valuations and AI software risks. The sector now leads the S&P 500, driving much of the current market strength. Analysts at Strategas estimate tech will deliver 60% of this year’s earnings growth. AI stocks remain central to that outlook, even with questions around supply chains and inflation.
“The combination of improving Iran headlines, investor exhaustion over the volatility in March, and a strong start to earnings season has helped to propel stocks to record highs,” Rick Gardner, chief investment officer at RGA Investments, said in a note. From my standpoint, the tech stocks’ rebound reflects patient buyers returning to discounted names.
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Earnings strength lifts the Wall Street outlook
Nearly one-fifth of S&P 500 companies have reported quarterly results so far. Among those firms, 86% beat earnings per share expectations, according to FactSet data. Strong profits support the broader Wall Street outlook as traders weigh geopolitical and energy risks. The current corporate earnings season shows resilience even with crude prices staying elevated.
Venu Krishna, head of US equity strategy at Barclays, pointed to strong AI and defense spending. He raised his year-end S&P 500 target on March 24 from 7,400 to 7,650 points. “Oil moving around at these levels at this point is not derailing that momentum,” Krishna said. His new target implies a 7% gain from Wednesday’s closing level.
S&P 500 and Nasdaq record highs raise caution flags
Louis Navellier, founder and CIO at Navellier & Associates, pointed to stable consumer and labor data. “Strong and rising earnings estimates, along with firm retail spending and stable labor markets, trump higher energy prices,” Navellier said. He added that momentum stays positive while fear of missing out grows among buyers.
Some investors warn the rapid climb to S&P 500 and Nasdaq record highs looks stretched. You should watch whether tech leadership holds as the war with Iran continues longer. The current stock market rally depends on steady earnings and cooler oil markets ahead. AI stocks will likely decide the next leg, given their weight in major indexes today.