Stock Market Today: Consumer Discretionary Leads Broad Rally as Oil Crashes 12% on Strait of Hormuz Reopening

Consumer Discretionary didn't just lead the stock market today. It ran away from the field. XLY surged +2.38%, the biggest single-sector move of the session, as airline and cruise stocks caught fire on growing confidence that the Iran conflict is winding down. United Airlines and Royal Caribbean were among the S&P 500's top gainers as traders priced in cheaper fuel and a return to normal travel demand.

The broader tape followed. All four major indexes closed green, with the S&P 500 punching above 7,100 for the first time ever. The Dow added nearly 870 points.

WTI crude collapsed 12.09% to $83.24 after Iran confirmed the Strait of Hormuz would remain open during the ceasefire. That pulled the rug out from under energy prices and sent risk appetite surging across equities. Nine of eleven sectors finished higher. Only two didn't get the memo: Utilities and Energy.

Market Scorecard

The S&P 500 and Nasdaq both breached fresh all-time highs this week, levels not seen since January. The Russell 2000 led the index pack with a +2.00% gain, a sign that risk appetite extended well beyond mega-caps.

Treasury yields fell across the curve, with the 10-Year dropping 6.3 basis points to 4.246%, as the oil crash eased inflation expectations. Gold still climbed +1.90% to $4,876.30, suggesting some hedging demand remains even in a risk-on session. Bitcoin joined the party at +3.23%.

What Moved the Stock Market Today?

The story of the day was oil, and everything that flows from it. Iran confirmed the Strait of Hormuz would remain open for the duration of the ceasefire, and crude didn't wait around for clarification. WTI cratered 12.09% to $83.24, well below the $110 peak hit during the worst of the conflict. That's the kind of single-session move that rewires positioning across the entire market.

Falling oil prices acted as a direct tailwind for consumer-facing sectors and a headwind for energy producers. President Trump's comments that peace talks should progress "very quickly" added fuel to the optimism.

The S&P 500 has now erased all losses since the Iran war began on February 28, rallying roughly 11% from its March 30 low.

The bond market got the message too. Yields fell across the curve as traders recalculated inflation expectations with cheaper energy in the mix. The reopened Strait of Hormuz may even recast the Fed's rate-cut options, though Fed Governor Waller struck a cautious tone, warning that the oil shock and tariff effects could still "lead to a more lasting increase in inflation."

He said the Fed may need to hold rates at the current 3.50%-3.75% range if inflation risks outweigh labor market concerns.

Earnings Reactions: Netflix and the Big Movers

NFLX fell 9% in extended trading after the company reiterated its full-year guidance of $50.7 billion to $51.7 billion in revenue. The first-quarter numbers were solid: $12.25 billion in revenue beat estimates, and net income of $5.28 billion nearly doubled year-over-year, boosted by a $2.8 billion termination fee from the collapsed Warner Bros. Discovery deal.

But "reiterated guidance" isn't what bulls wanted to hear after a stock that's been running. Co-founder Reed Hastings also announced his exit from the board.

Earnings season is just getting started. Only 32 S&P 500 companies have reported so far, with 78% beating expectations. The blended growth rate for Q1 is tracking at 12.5%. Next week brings a broader wave of reports across airlines, defense, and other sectors.

Sector Performance

The sector rotation here was textbook. Consumer Discretionary (XLY) topped the board at +2.38%, powered by airlines and cruise lines betting on cheaper jet fuel and a peace dividend for travel demand. Industrials (XLI) followed at +1.83%, while Real Estate (XLRE) benefited from the drop in yields.

At the bottom, Energy (XLE) fell -2.81%, the only sector to lose more than half a percent, as crude's collapse hit producers directly.

What Are Fear and Greed Indicators Saying Right Now?

The Fear & Greed Index sat at 68, firmly in Greed territory. That's consistent with a market that's been climbing a wall of worry for weeks and now feels like it's cleared the top.

The VIX dropped to 17.49, down 2.51%, confirming the risk-on mood. The stock market today reflected that confidence across every major index.

Wall Street Bets tracked 2,748 total mentions with a sentiment score of 0.03, essentially neutral. Retail wasn't driving this tape. The big moves aligned with the oil shock and ceasefire developments rather than any single meme-stock catalyst.

What Should Traders Watch Next Week

Earnings season ramps up significantly next week. Airlines like United Airlines, defense names like Lockheed Martin and RTX, and a broad mix of sectors will report. With 78% of early reporters beating expectations and blended Q1 growth tracking at 12.5%, the bar is set.

The question is whether forward guidance reflects the same optimism the stock market today is pricing in, or whether management teams sound more cautious on tariffs and the still-fragile ceasefire.

The ceasefire itself remains the biggest variable. The U.S. and Iran have each accused the other of breaking the agreement, and the two-week window is ticking. If it holds, the "peace trade" in Consumer Discretionary and Industrials likely has more room. If it fractures, that 12% oil drop could reverse in a hurry, and the sector rotation story flips overnight.

Fed commentary will matter too. Waller's cautious tone, warning about lasting inflation from oil and tariffs, suggests the central bank isn't ready to cut even if the stock market today is pricing in a softer environment. Markets currently expect the Fed to stay on hold for the rest of 2026. Any shift in that expectation could move bonds and equities in a hurry.