Stock Market Futures Surge as Iran Opens Strait of Hormuz — Wall Street’s Best Day in Months

Before the opening bell, there is a certain kind of electricity in futures markets. It’s not audible, but you can sense it in the headlines, pre-market tickers, and the way traders discuss crude oil over their morning coffee. That charge was present from the beginning on Friday, April 18. The Nasdaq had put together 13 consecutive winning days, the S&P 500 had crossed 7,100 for the first time in its history, and oil had dropped 12% in a single session by the time Wall Street’s closing bell rang. What is the catalyst? The Strait of Hormuz was opened by Iran.

It’s difficult to ignore that sentence and take a brief break. Billions of dollars were transferred in a matter of hours after a foreign minister posted a few lines on X about coordinated maritime routes and commercial vessels. Declaring the strait “completely open” in accordance with the Israel-Lebanon ceasefire, Seyed Abbas Araghchi used more than just diplomatic language. It was a breath of fresh air for markets. Before the opening bell even rang, stock market futures continued to rise, with S&P 500 futures up 0.23% and Dow futures pointing to a gain of nearly 175 points. These gains continued into Friday morning as ceasefire negotiations solidified.

With millions of bets that are priced and stacked to reflect traders’ expectations for the upcoming trading session, futures markets function as a sort of collective prediction. They are notoriously erratic, flawed, and sometimes completely incorrect. However, they are also among the most accurate real-time indicators of market psychology. Additionally, there was a clear optimism, if cautious optimism, in the psychology leading up to Friday. According to President Trump, Iran has agreed to give up its nuclear aspirations, and negotiations may pick back up over the weekend. As is often the case in geopolitics, the question of whether that optimism was entirely justified remained unanswered.

An otherwise upbeat morning was somewhat disrupted by Netflix’s earnings. Following the release of below-consensus Q2 guidance and the announcement that co-founder Reed Hastings would resign from the board in June, the streaming behemoth saw a more than 9% decline in pre-market trading. On a typical Friday, this type of corporate news might have caused the market to tremble. However, this Friday was not like any other. With ON Semiconductor rising more than 10% and AMD rising 7%, chip stocks had already absorbed the energy from Taiwan Semiconductor’s earnings beat a day earlier, and it was proving challenging to reverse the momentum. Netflix collapsed. For the most part, everything else continued to rise.

There’s a certain vertigo to seeing this happen from the outside. In the past, a 12% drop in oil prices in a single day would indicate fear of a recession, panic, or serious problems. It was a sign of peace here. Airlines, cruise lines, and shipping—the sectors most susceptible to a blocked strait—saw a sharp decline. Boeing saw a 2% increase. Royal Caribbean saw a 7% increase. Amazon rose. In addition to pricing in the ceasefire, the market also priced in a future in which the worst-case scenario—which had been subtly factored into valuations for weeks—just didn’t materialize.

An already complicated picture was further complicated by the economic data that was made public on Thursday. The number of unemployed claims decreased by 11,000 to 207,000, which would appear to be a sign of resilience on its own. The Philadelphia Fed’s manufacturing index surged above forecasts of 10.3 to 26.7, a 15-month high. However, both manufacturing output and industrial production decreased by 0.5% each month. Clean narratives are challenging because of this kind of mixed bag. Although he still sees rate cuts in the long run, New York Fed President John Williams acknowledged this, pointing out that increased uncertainty should prevent officials from providing strong guidance on rates. At the upcoming Fed meeting, markets priced in a 99.5% chance of no change. It was almost soothing, that near-certainty.

With the exception of Netflix and Alcoa, the earnings season has been fairly positive thus far. Bloomberg Intelligence predicts that S&P 500 companies will report an average 12% increase in quarterly earnings for Q1, marking the sixth consecutive quarter of double-digit growth. It’s not an anomaly. Despite tariff uncertainty, geopolitical noise, and a Fed that isn’t exactly rushing to cut, investors appear to think that trend has room to continue. The names that reported on Friday included State Street, Regions Financial, Fifth Third Bancorp, and Truist Financial, adding more color to a season that already has traders cautiously optimistic.

On a day full of news, Bitcoin’s brief surge above $76,000, its highest point since early February, seemed insignificant, but it wasn’t nothing. Cryptocurrency typically moves in tandem with risk appetite, and on Friday, that appetite was evident. The same underlying sentiment that drove stocks may have been reflected in Bitcoin’s move: relief, some sincere optimism, and a sense that the market had survived something that could have gone much worse. The VIX kept declining. Real or feared, volatility was fading.

What will happen in the next few days is still unknown. There are restrictions on the reopening of the Strait of Hormuz: ships associated with “hostile nations” are reportedly not allowed to pass through, and Iran’s news agency warned that if the U.S. naval blockade continues, the strait may close once more. These aren’t little asterisks. The blockade would stay “in full force” until a formal peace agreement is reached, according to Trump’s Truth Social posts. Futures markets will be analyzing this tension between geopolitical fragility and market optimism every overnight session for weeks to come.

Since 1992, the Nasdaq has not experienced a 13-day winning streak. When it last ran this long, the internet was hardly a commercial idea and Bill Clinton had just been elected president. Monday could be the end of that run. Perhaps it won’t. However, it says something about this specific moment—a market that has continued to rise despite wars, tariff concerns, conflicting economic signals, and tech turbulence. Even as the numbers continue to rise, it is worthwhile to consider whether that persistence is a sign of true confidence or something more brittle.