I noticed an interesting paradox in the market over the past few weeks. The S&P 500 has risen nearly 10% since the end of March, while the Nasdaq 100 has shown an even more impressive gain—about 12%. Meanwhile, geopolitical tensions in the Middle East have not gone away. It seems Wall Street has simply switched into a mode of selective ignoring of problems.

What’s truly surprising is how quickly the narrative has changed. A month ago, it seemed that the conflict could seriously undermine the markets. Now, financial analysts are saying that the market has already declared itself the winner. The Houthis have not carried out escalation attacks in the Red Sea, drone strikes have not increased, and the ceasefire agreement remains in effect. This has genuinely changed the tone.

The main driver of growth is Mag 7—the very leaders in artificial intelligence. Over the past 10 trading days, they accumulated a 15% gain, and 9 out of 10 days were positive. The chip sector played a key role: expectations for profitability there increased by roughly 10% in just three trading days. According to analysts, NVIDIA and Micron could account for more than half of S&P 500 profitability growth for the quarter.

What’s interesting is that this upward move is not only a story about stocks. Treasury bond yields are down by 3–4 basis points, Bitcoin has surpassed 76,000 dollars, and gold is trading above 4,800. Liquidity in the stock market has returned to normal—the spreads on the S&P 500 rose from 3.5 million to 13.16 million dollars.

Behind this growth lies an interesting dynamic. After a mass sell-off, institutional investors have returned to analyzing fundamental indicators, which remain supportive. CTA funds are actively buying, while hedge funds are doing the opposite—reducing positions in technology and industrials. Short positions are being closed urgently, especially in loss-making tech companies.

But there are skeptics as well. Some analysts warn that the uncertainty of the war is still creating a risk of a correction. In the oil market, the picture looks different—WTI has fallen below 91 dollars, which contrasts with optimism in equity markets. It seems the oil market believes that normalization of supplies will take more time.

Overall, the market is looking ahead. The S&P 500 has fully recovered the losses from the Iran conflict, but there is still a path before reaching historical highs. The quarterly earnings season is starting, and the banking sector is already showing that the economy is holding up more strongly than investors feared. Inflation data is also providing support. If the negotiations truly make progress, then conservative positioning and revised expectations could create a powerful impetus for further growth.