Markets just hit new highs again.
The S&P 500 is now up for four straight weeks, and the NASDAQ continues to push higher as if the path forward is clear.
But it isn’t.
This rally is built on one core assumption:
The war ends, oil falls, and everything normalizes.
That may happen. But right now, it’s still a bet.
Markets Are Pricing in the Best Case
Oil is back near $100, yet stocks are holding up well.
Why?
Because markets believe that price won’t last—and that supply issues will resolve.
At the same time:
Consumers are still spending
Retail sales are holding up
The economy continues to push forward
So far, the system is absorbing the shock.
Earnings and Capex Are Carrying the Load
The real support behind this market is not headlines—it’s profits.
Technology earnings expectations remain extremely strong
Corporate investment (capex) is driving productivity
Profit growth continues to hold up despite higher costs
That’s why markets haven’t cracked.
But Inflation Isn’t Going Away
Here’s the issue.
Inflation is still running above where the Fed wants it
Oil prices are adding pressure
And there’s little slack left in the system
That combination tends to keep inflation sticky, not temporary.
Which means:
The Fed is likely stuck on hold longer than markets would prefer.
The Risk Most Investors Are Ignoring
Markets are moving higher—but they’ve already priced in a favorable outcome.
Meanwhile:
The ceasefire is still unclear
The Strait of Hormuz is not fully normalized
And supply risks remain
If that situation drags on—or worsens—markets will have to adjust quickly.
My Perspective
This is a strong market—but it’s not a comfortable one.
It’s being driven by:
Solid earnings
Continued economic momentum
And a belief that geopolitical risks will fade
That last piece is doing more work than most people realize.
Bottom Line
Markets are strong—but forward-looking assumptions are doing the heavy lifting
Inflation remains persistent beneath the surface
Energy is still the key variable
If the current narrative holds, markets can keep moving higher.
If it doesn’t, there’s not much margin for error.
About Gary Hager
Gary K. Hager, CFP®, CBEC, CTFA is the founder of Integrated Wealth Management. He advises business owners and families on exit planning, estate strategies, and long-term wealth structuring.