Markets Look Past War Risks as Earnings Remain Strong and Broadening Continues

Despite lingering geopolitical tensions, higher oil prices, and renewed inflation concerns, equities moved higher in April, supported by a strong start to the Q1 earnings season and resilient economic growth. After approaching correction territory late last month, the S&P 500 rebounded to post seven record closing highs, gaining more than 10% for its strongest monthly performance since November 2020. The tech-heavy Nasdaq-100 also surged over 15%, marking its best month since April 2020. The rebound was broad-based, with US small-caps (+10.4%), emerging market equities (+9.2%), and US mid-caps (+7.8%) all posting strong gains. Aside from 7-10 year US Treasuries (-0.1%), bonds also fared well as high yield credits increased 1.7%, municipal bonds rose 1.2%, and Treasury Inflation Protected Notes gained 1.1%. Commodities produced mixed returns as both crude oil and broad based commodities rose (15.6% and 4.2%, respectively), while both silver and gold fell (-2.2% and -1.5%, respectively).