Why are the S&P 500 and Nasdaq on track for their best monthly gains since 2020 despite escalating Middle East tensions?

The S&P 500 and Nasdaq are on course for their biggest monthly gains since November 2020 and April 2020, respectively, because investors are prioritizing resilient corporate earnings over geopolitical risks — a 'tug of war' where 'the earnings side is winning so far,' according to Angelo Kourkafas of Edward Jones; strong results from Big Tech (e.g., Alphabet’s record cloud quarter) and other sectors (e.g., Eli Lilly’s raised profit forecast and Caterpillar’s record high on higher Q1 profit) have steadied markets despite oil price spikes and fears of military escalation with Iran.

What role are rising oil prices and U.S.-Iran tensions playing in the current market environment?

Rising oil prices — with Brent crude hitting its highest level in nearly four years amid fears of protracted disruption — and heightened U.S.-Iran tensions, including an Axios report indicating increased urgency from the Trump administration to 'bring things to a head,' have undermined diplomatic optimism and contributed to market uncertainty; although oil prices retreated slightly from peaks, they remain elevated around $110 a barrel, driving up gasoline prices, squeezing household budgets, and raising concerns that war-driven costs could eventually pressure corporate growth — a risk that grows 'the longer it lasts,' per Kourkafas.

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S&P 500, Nasdaq On Course for Best Month Since 2020 Despite Middle East Risks

Apr 30, 2026

U.S. stock indices are on track for their best monthly performance since 2020, supported by strong earnings despite oil price spikes from Middle East tensions. Eli Lilly and Caterpillar led gains, while Brent crude hovered near $110 per barrel.

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S&P 500, Nasdaq On Course for Best Month Since 2020 Despite Middle East Risks