Back on April 9th, 2025, the US announced a pause on the Liberation day tarrifs. SPY rocketed +11.14% that day.
The situation with Iran is different. Higher oil prices, along with other commodities, will work their way through the supply chain and depress economic activity. Additionally, oil infrastructure has been damaged during the war and will take months to years to become operational again.
However, it is unlikely investors will wait on the sidelines until the oil infrastructure is fully repaired and supply returns to pre-war levels. Everyone will want back into the market before the rally. A legit peace deal likely will cause an immediate rally.
SPY is down about -5% since the start of the war, and was likely depressed prior to the war in anticipation of an impending sell-off.
If a legit peace deal is announced soon, how big do you think the rally would be?