Stocks gain on Iran ceasefire, plus 3 things that drove last week’s market
The S&P 500 index had its best week since November, thanks to the impact of the US and Iran’s agreement on a temporary ceasefire. President Donald Trump announced late Tuesday that he would pause attacks on Iran for two weeks, sending stocks higher. The S&P 500 rose 2.5% on Wednesday and the Nasdaq rose 2.8%. The Dow index had its best day since April 2025. “We have a barn burner, and I would say it’s pretty widespread,” Jim Cramer said of Wednesday’s market action. This session reminded us how important diversity is. If the club had exited overseas war-hit stocks, such as energy stocks, we would have missed the rally in economically sensitive names. Jim pointed to Home Depot, which was up 5.5% on Wednesday and has gained 4.8% since the beginning of the week. Although the market’s rally cooled on Friday, the S&P 500 still finished the week up 3.6%. The Dow and Nasdaq gained more than 3% and 4.7%, respectively. All three indicators recorded their best weeks since November. It wasn’t just the easing of tensions in the Middle East that moved stocks; Here are three more factors affecting the market. Inflation Wall Street received the first updated data on inflation since the war in Iran began on February 28. Investors are worried that rising oil prices will negatively affect the US economy. The consumer price index increased by a seasonally adjusted 0.9% in March, bringing annual inflation to 3.3%, in line with analysts’ forecasts. The gain was driven by a 10.9% increase in energy costs. But core prices, which exclude energy and food, came in better than feared, indicating that the underlying inflation situation is under control. The market is not clear yet, given the fragile state of the ceasefire. One wildcard for stocks: peace talks between the United States and Iran scheduled for this weekend in Pakistan. “I don’t think that’s been given enough consideration,” he said during Friday’s Morning Meeting. Software sales The hardware buy, software sell trade is back in full force this week. While investors flocked to companies that form the basis of data center and artificial intelligence infrastructure, they also fled those they perceived to be under threat. “If you’re in camp, you’re treated like you’re embalmer ready,” Jim said on Thursday’s “Mad Money.” “If you’re in the hardware and AI camp, you’re heading into the pantheon of greatness.” Jim said the “stocks are semiconductor players,” pointing to Marvell Technology and Intel, which closed the week up 20% and 23%, respectively. Corning, which makes optical fiber for AI data centers, gained 15.7%. On the other side of the trade was software. Salesforce fell for the fifth consecutive session on Friday, falling nearly 12% for the week. He was also the Club’s worst weekly performer. Adobe lost 7.2% of its value. The IGV software ETF, the benchmark software index, fell nearly 7%. Jim said its performance is an important indicator of Wall Street sentiment because “This ETF is the primary way large institutions are betting on software or betting against software.” Cyber and other non-traditional software names in the fund are collateral damage. CrowdStrike and Palo Alto Networks are down 5% and 4.5%, respectively, since the beginning of the week. Meta accelerates its artificial intelligence work There is more good news for the portfolio. Meta introduced a new artificial intelligence model on Wednesday and sent shares skyrocketing. It’s called Muse Spark, and it’s the first product in the company’s new Muse series, developed by Meta Superintelligence Labs. Although Meta has leveraged AI to benefit its advertising business, it has been slow to create its own popular AI model. Llama’s debut was not well received. The company is now moving into a market dominated by Google Gemini, Anthropic’s Claude, and OpenAI’s ChatGPT. If the meta succeeds, Wall Street will rely more on aggressive AI spending plans. Management had previously forecast capital expenditures for fiscal 2026 to be between $115 billion and $135 billion, up from about $70 billion last year. Meta shares rose 9.6% last week, driven in part by the overall rally in the market. (See here for a complete list of stocks in Jim Cramer’s Charitable Trust.) When you subscribe to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trading alert before buying or selling a stock in his charitable foundation’s portfolio. If Jim talked about a stock on CNBC TV, he would wait 72 hours after issuing the trading alert before executing the trade. THE ABOVE INVESTMENT CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY, TOGETHER WITH THE DISCLAIMERS. NO CIVIL OBLIGATIONS OR DUTIES EXIST OR SHALL BE RESULTING FROM YOUR RECEIVING ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTMENT CLUB. NO SPECIFIC RESULT OR PROFIT CAN BE GUARANTEED.
