This week on 7 Market Movers:

• The S&P saw a sharp rally in equities following the announcement of a ceasefire between Israel and Lebanon—rising 7.5% to reach a new all-time high, reflecting optimism of continued de-escalation.
• As earnings season kicked off and data has started to roll in, we’ve seen solid numbers across banks, transportation companies, and tech companies.
• We saw particular strength in manufacturing (ex-tech), with production increasing 2.8% on an annualized basis—the healthiest pace since 2021. 

Watch the full video to learn more!

TRANSCRIPT:

Hello and welcome to our weekly Market Movers video series from Wealth Enhancement. My name is Aya Yoshioka, Director and Senior Investment Strategist. Each week, we highlight the headlines that capture the market’s attention and what it means for you, the investor.

Well, markets rallied sharply this week with the S&P 500 reaching record highs. Usually, we say that the market likes to take the elevator down and slowly ride the escalator back up. But looking at the month of March and the first two weeks of April so far, it has been the opposite experience. March was a month in which the S&P 500 took a stair step down. While the first two weeks of April, we’ve witnessed a sharp rebound with the equity markets rallying over 7.5% to new all time highs. The S&P 500 closed above the seven thousand level for the first time on Wednesday, April fifteenth, tax day. Treasury yields remained steady with the 10-year at 4.3% and the 2-year at 3.8%.

So what has changed? Well, President Trump announced a 10 day ceasefire between Israel and Lebanon, and Reuters reported that a key Pakistani mediator achieved a breakthrough on a sticky issue between US and Iran. Iranian officials cautioned that the future of the nation’s nuclear program remained unresolved. And despite all of these headlines, optimism related to the de escalation continued to rise and has helped markets.

We’ve seen key gauges of volatility in bond, currency, and equity markets decline almost every day since the end of March, and traders have tentatively revised revived a range of bets that benefit from this falling volatility.

From an economic data perspective, inflation and economic growth have been the key data points that the market continues to watch.

In that regard, we got the latest gauge on inflation through the consumer price index or CPI data last Friday on April 10th, and that showed inflation surged 0.9% in March compared to February, the largest monthly jump since 2022.

And this was because higher gas prices were incorporated into the inflation calculus. From a year ago, CPI was up 3.3%, the strongest pace since 2024. Again, a record increase in gasoline prices was responsible for nearly three quarters of the monthly advance. And when you exclude food and energy and look at core CPI instead of the headline number, core CPI was up 0.2% month over month and up 2.6% compared to this time last year.

When it comes to growth, we’re always watching the labor market and the weekly jobless claims data, which is a pretty frequent indicator of health of the labor market. This week, we saw initial jobless claims of 207,000, down 11,000 from the prior week, marking the biggest one week drop since February and signaling that layoffs remain largely limited.

Speaking of economic growth, we continue to see strength in manufacturing, and the Philly Fed index rose to 26.7 in April, well above the median estimate of 10. New orders rose to 33 versus 8.6, and shipments rose to 34 versus 22.2 in the prior month. US factory output snapped back in the first quarter after disappointing at the end of 2025 with manufacturing production, excluding high-tech industries increasing an annualized 2.8%, one of the healthiest paces since 2021.

Shifting from macro data to the micro, we’re in the first week or so of first quarter 2026 earnings season. Analysts currently anticipate MSCI World Index companies to achieve a 14% increase in their 2026 earnings, while projections for the S&P 500 companies are at 9% in terms of growth year over year. As we go through earnings season, we’ll be watching to see if these expectations might be too high or not, and to see if the prolonged war in Iran could necessitate any downward revisions.

So far, we’ve seen 8% of the S&P 500 companies report with the majority of them being in the financial sector. We saw some solid earnings from several of these major banks, a couple of transport companies, and some tech companies outside the US like ASML and Taiwan Semiconductor.

AI and geopolitics continue to be a dominant theme during these earnings calls alongside the overall resiliency of the US consumer and the US economy.

In conclusion, the combination of peace, hopes, resilient economic data, and technical buying really created a powerful rally in equity markets, though the sustainability of all of this and current valuations continue to remain a little uncertain, just given the ongoing geopolitical risks and elevated inflation that we’re seeing in markets.

With that, thank you so much for listening, and we’ll see you again next week.

This information is not intended as a recommendation. The opinions are subject to change at any time and no forecasts can be guaranteed. Investment decisions should always be made based on an investor’s specific circumstances. Investing involves risk, including possible loss of principal.

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