Wall Street hits a record as S&P 500 continues its 2-week rally on hopes
for an end to the Iran war
[April 16, 2026] By
STAN CHOE
NEW YORK (AP) — The U.S. stock market hit a record Wednesday after
adding to its two-week rally built on hopes the war with Iran won’t
create a worst-case scenario for the global economy. Whether Wall Street
is correct to have so much hope for peace and whether stocks should be
the highest they’ve ever been remains to be seen.
The S&P 500 rose 0.8% and eclipsed its prior all-time high set in
January. After falling nearly 10% below its record in late March, a drop
steep enough that Wall Street calls it a “correction,” the index at the
heart of many 401(k) accounts has since roared more than 10% higher.
Much of the rally has been due to expectations for calming tensions in
the war and a resumption of the full flow of oil from the Persian Gulf
to customers worldwide. Hopes remained high Wednesday as regional
officials told The Associated Press that the United States and Iran had
an “in principle agreement” to extend a ceasefire to allow for more
diplomacy.
To be sure, stocks could easily get back to falling if those
expectations get undercut, which has happened before in the war. Oil
prices drifted up and down Wednesday and showed that caution remains in
financial markets. Stock indexes around the world also made only modest
movements following their big gains in recent weeks.
The price for a barrel of Brent crude, the international standard, added
0.1% to settle at $94.93. That’s still well above its roughly $70 price
from before the war, though it’s down from its $119 peak when worries
about the fighting have been at their heights.
The Dow Jones Industrial Average dipped 72 points, or 0.1%, while the
Nasdaq composite gained 1.6%.
But if U.S.-Iran talks do happen and if they are successful, the war
could end up being just a temporary setback for the global economy
instead of a new normal of very high oil prices and inflation. And that
in turn could allow investors to return their attention to what matters
most for stock prices: money.
Through all the day-to-day noise that can affect investors’ opinions,
stock prices tend to move with the direction of corporate profits over
the long term. And positive trends there had stock markets doing well
before the war began. Analysts also see continued growth ahead, for now
at least.
Bank of America rose 1.8% after saying it made $8.6 billion in profit
during the first three months of the year, more than analysts expected.
CEO Brian Moynihan also said the bank saw signs of a “resilient American
economy,” including solid spending by U.S. consumers.
Morgan Stanley jumped 4.5% after the investment bank likewise delivered
a better-than-expected quarter of results.
Companies hurt earlier in the year by worries about
artificial-intelligence technology also rose to recover more of their
losses for 2026. Some of the concerns were about companies potentially
spending too much to build out AI capabilities, while others focused on
businesses that may go obsolete because of AI-powered competition.
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People work on the floor at the New York Stock Exchange in New York,
Monday, April 13, 2026. (AP Photo/Seth Wenig)
 The worries got so deep that they
shook private-credit companies that have lent money to software
businesses and others potentially under threat because of AI.
ServiceNow climbed 7.3%, Oracle rose 4.2% and Ares Management gained
5.9% for some of Wednesday’s bigger gains in the S&P 500. All are
still down between 12% and 39% for the year so far.
With stock prices overall back to where they were in January, and
with analysts’ expectations for upcoming profits from big U.S.
companies only rising since then, optimists say many stocks look
less expensive than they did a few months ago.
“Today, we see compelling opportunity potential” to shift into areas
of the market that look like better buys than earlier this year,
such as technology stocks, said Mason Mendez, investment strategy
analyst at Wells Fargo Investment Institute.
The stock price of Allbirds surged 582% to nearly $17 after the
company said it’s shifting gears and moving into the AI compute
infrastructure industry, while changing its name to NewBird AI. The
Allbirds name will stay with the shoe brand that the company has
already agreed to sell to American Exchange Group.
Nike rose 2.8% after CEO Elliott Hill and Tim Cook — a Nike director
and the CEO of Apple — disclosed that they purchased a combined
48,000 shares of the athletic shoe maker at a cost of about $1
million each. Nike shares are still down nearly 29% this year.
On the losing end of Wall Street was Live Nation Entertainment. It
fell 6.3% after a jury found the concert giant and its Ticketmaster
subsidiary had a harmful monopoly over big concert venues.
All told, the S&P 500 rose 55.57 points to 7,022.95. The Dow Jones
Industrial Average dipped 72.27 to 48,463.72, and the Nasdaq
composite rose 376.93 to 24,016.02.
In stock markets abroad, indexes were mixed in Europe following
modest gains in Asia. South Korea’s Kospi was an outlier and jumped
2.1%.
In the bond market, the yield on the 10-year Treasury rose to 4.28%
from 4.26% late Tuesday.
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AP Business Writers Yuri Kageyama and Matt Ott contributed to this
report.
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