Fire, Ceased. Markets finally got the cease-fire they have been aching for, and the subsequent relief rally was fast, furious, and jubilant—no matter that the truce is temporary and fragile.

The S&P 500 surged 2.5% on Wednesday, the Nasdaq Composite increased 2.8%, and the Dow Jones Industrial Average gained 1,327 points, or 2.9%.

All sectors but energy gained on the day. Indeed, oil prices tumbled. WTI crude oil futures sank 16% to $94.41 a barrel. Brent crude fell 13% to $94.75 a barrel.

“There will be lots of positive action!” President Donald Trump wrote in a Truth Social post today. “Big money will be made. Iran can start the reconstruction process. We’ll be loading up with supplies of all kinds, and just ‘hangin’ around’ in order to make sure that everything goes well.”

Just how long they’ll have to hang is still unclear, particularly because the cease-fire is already in a precarious spot. Iranian Parliament Speaker Mohammad Bagher Ghalibaf claimed in a post on X this afternoon that three clauses of Iran’s 10-point peace proposal had already been violated, making a cease-fire or negotiations “unreasonable.”

One of the cease-fire’s pain points is whether the agreement extended to fighting in Lebanon, which continued to receive Israeli attacks over the course of the day. The U.S. and Israel say Lebanon wasn’t included in the cease-fire, while Iran says it was, and it closed the Strait of Hormuz again in response.

Daniela Hathorn, senior market analyst at Capital.com, writes:

Vice President JD Vance told reporters later in the day that the Israelis have offered to “check themselves a little bit” in Lebanon to make sure negotiations are successful. But both the vice president and other administration officials have said the U.S. could resume fighting if Iran the cease-fire falls apart—which it could very well could.

“Strategists note a still-wide gulf between Iran’s 10-point plan for an off-ramp and what the U.S. has wanted, which is why many are looking beyond what is being said to what’s happening on the ground,” writes my colleague, Reshma Kapadia.

Signs include how many tankers pass through the Strait, any drone attacks on energy infrastructure, additional military deployments to the region, or new ultimatums from President Trump, among others.

We’ll be on the lookout. And for a deeper dive into how geopolitics is affecting markets, consider subscribing to our new newsletter, Barron’s Global Signals.

The Hot Stock: Teradyne +11.8%
The Biggest Loser: APA Corporation -9.8%

Best Sector: Industrials +3.8%
Worst Sector: Energy -3.7%

Not to burst your bubble, but the war isn’t the only risk on the horizon. The private credit problem is still very much real, and could come to the forefront when big banks report their first-quarter results next week.

Private credit default rates have been rising for a while now, peaking at 5.8% in January before falling to 5.4% in the trailing 12-month period ended in February, according to Fitch Ratings.

Some of that uptick is likely tied to the software industry’s AI troubles, analysts say. For years, private lenders lent money to software companies, counting that their steady stream of subscription income would let them easily pay back the loans. AI may change that calculus—if people are choosing Claude over an established software system, these companies may struggle to pay private lenders back.

If top financial executives hint the worst has yet to come for private credit, shares of financial companies could be hit hard, writes my colleague, Paul La Monica.

That could have big impacts on life insurers, which have invested heavily in private credit. A report from the Chicago Fed last year noted that private placement lending by life insurers in 2024 totaled $849 billion, more than double the volume of $386 billion a decade earlier, Paul adds.

Alternative asset management firms like Apollo Global Management, Blackstone, Ares Management, Blue Owl, and KKR, could also drop if banks flag private credit risks, he adds.

The Bureau of Economic Analysis releases the personal consumption expenditures price index for February. Economists forecast a 2.8% year-over-year increase, matching January’s data. The core PCE price index, which strips out volatile food and energy prices, is expected to rise 3%, one-tenth of a percentage point less than previously.

The BEA releases its final estimate for fourth-quarter gross-domestic-product growth. Expectations are for an annualized 1.4% increase.

• Exxon Mobil Stock Is Falling. Why Energy Is Going From Record Gains to a Major Slump.

• Warren Buffett Is Retired. His Latest Advice Couldn’t Be More Timely for Young Investors.

• Rigetti Is Growing Sales of Quantum Computers. That’s Good for the Stock.

• Why GE Aerospace Stock Is Having Its Best Day In Nearly a Year

• What the Cease-Fire With Iran Means for U.S. Consumer Spending

Barron’s Live returns on Monday. Barron’s Live features timely and actionable insights for investors. We give you behind-the-scenes conversations with the newsroom, connecting you with our editors and reporters covering the markets, the economy, and more.

Sign up here