S&P 500 e-mini futures climbed 1.4% to 6,742 in early Sunday trading, while Nasdaq-100 futures advanced 1.9% to 24,180 and Dow futures added 412 points. The rally followed Saturday's Iranian government statement confirming reopening of the Strait of Hormuz to commercial traffic and the announcement of a 90-day ceasefire framework brokered by Oman and Qatar.
The move sets up what could be the busiest earnings week of the post-pandemic era, with Microsoft (MSFT), Meta Platforms (META), Apple (AAPL) and Amazon (AMZN) — collectively worth $14.2 trillion in market capitalization — reporting between Tuesday and Thursday. Combined revenue for the four firms is expected at $612 billion for the quarter, with consensus EPS implying year-on-year earnings growth of 14.3%.
Cash Pile Awaits Deployment
Money market fund assets stood at $7.91 trillion as of Wednesday, an all-time high, according to Investment Company Institute data. Strategists at Goldman Sachs estimate that even a 5% rotation into equities would inject roughly $395 billion of buying pressure, equivalent to 13 weeks of typical net inflows into the S&P 500 ETF complex.
"The combination of geopolitical de-risking, a probable Fed cut on May 1, and consensus-beating earnings creates the conditions for a melt-up into mid-quarter," Morgan Stanley chief U.S. equity strategist Mike Wilson wrote in a Sunday note, lifting his year-end S&P 500 target to 7,250 from 6,800.
Sector Setup Favors Cyclicals
Technology and consumer discretionary sectors led overnight gains, with chip designer Nvidia (NVDA) up 2.7% in pre-market and Tesla (TSLA) advancing 3.4%. Cyclically sensitive industrials including Caterpillar (CAT) and Deere (DE) gained more than 2%. Defense and energy lagged as the Iran de-escalation cooled bid for hedges, with Lockheed Martin (LMT) easing 1.6% and Exxon Mobil (XOM) slipping 0.9% after a 14% rally over the prior fortnight.