US-Iran ceasefire hopes just reversed a market selloff — buy the relief rally
Reports suggest the US and Iran are close to extending a ceasefire, which removed a major source of fear from the market. Stocks reversed their losses and surged higher on the news, and one of Wall Street's most closely watched strategists says stocks are likely to keep climbing.
Idea
The US-Iran conflict has been the single biggest cloud hanging over markets this week. Now that both sides are reportedly nearing a ceasefire extension, a huge risk premium is being removed from stocks all at once. Wall Street reversed its losses immediately on the headlines. Meanwhile, Citadel's Scott Rubner — one of the most influential voices on market positioning — says the 'pain trade' (meaning the move that would hurt the most people) is for stocks to keep going up. With earnings also coming in strong and market-timers having already bailed out at near-record pace, there's fuel for a continued rally.