NEW YORK, NY, September 22, 2026 — After oil prices sank and corporate profit kept beating estimates, Wall Street nudged toward record highs this week. The S&P 500 gained about 0.8% to hit a record high above its previous closing peak, while the Dow Jones Industrial Average and Nasdaq composite also finished solidly higher. After weeks of turmoil connected to conflict in and around the Middle East, investors also welcomed relief from rising energy prices.
Oil’s Retreat Lifts Sentiment
Stocks rose after crude prices surrendered much of their recent jump. Brent crude, the international benchmark price for oil, lost about 4%, after hitting a peak above $115 a barrel earlier in the week. Prices are now many dozens of dollars higher than the roughly $70 level before the start of the war involving Iran, despite having fallen back a bit, as noted in energy reporting from the U.S. Energy Information Administration.
Despite a separate assault against the United Arab Emirates which U.S. military leaders said was conducted by Iran, they maintained that a ceasefire still exists with Tehran through October 2023. U.S. forces have also been engaged in efforts to reopen shipping lanes through the Strait of Hormuz. A clear route there could mean tankers can return to their regular deliveries from the Persian Gulf, perhaps even further easing prices.
Corporate Earnings Keep Surprising
Despite the ongoing war, the resilient U.S. stock market has continued its record-setting run during 2023. Much of that resilience is due to sustained, stronger than expected corporate profits, which have consistently beaten expectations set by analysts throughout higher oil prices. One recent spike came from chemical giant DuPont, which beat estimates in its quarterly results, standard for companies registered with the U.S. Securities and Exchange Commission.
Wells Fargo Investment Institute’s senior global market strategist Scott Wren concluded: “This has been a ‘why ask why’ market. Just roll with it!” Investors have been focused on earnings and the amount that companies are spending in terms of AI data centers, etc. over a longer-term horizon, he noted.
An Ongoing Risk With a Resilient Market
Still, this largely upbeat trajectory is tempered by a number of risks still in play. For most of the year, Treasury yields have tracked oil-led inflation concerns and at times weighed on growth-oriented stocks, monitored by the U.S. Department of the Treasury. Whenever crude prices rise unexpectedly, airlines and other fuel-dependent industries get hit with some of the steepest price swings.
Financial sector stocks were also sensitive to changing expectations regarding the next move from the Federal Reserve on interest rates, as detailed on the official Federal Reserve website. Hawkish signals from central bank officials deepened bets that higher borrowing costs could endure should inflation drive back up because of rising energy prices. Yet, around 84% of S&P 500 companies reporting earnings this year have beat expectations, according to FactSet data.
What Investors Are Watching Next
And if the rest of the world holds out next moves for the market most analysts believe will depend on how the Middle East conflict subsides in weeks to come. But a long-lasting truce or breakthrough in diplomacy would push oil prices further down and remove the barricades from achieving an upside. A new round of escalation, however, could quickly unwind market directional trade.
In the meantime, some strategists argue that the underlying economic picture is sufficiently robust to absorb further volatility. Consumer spending has been much more resilient than many forecasts suggested earlier in the year, and corporate profit growth remained robust across most industries. The question is, will the strength last throughout the rest of year and is this better controlled by geopolitics or the next set of earnings reports.
Retail investors too have been a significant force in keeping the rally going, with trading activity remaining elevated even through this year’s most turbulent patches. The continuation of record participation, they say, has helped to shield the market from steeper pullbacks when oil headlines take a negative turn. Among equity strategists, that behavior is considered a vote of confidence over the fundamental path for the economy even with geopolitical risks still high.
In the bond market, some days when oil pulls back, those yields ease; on others, when fresh tension arises they rise again. It has complicated matters for fixed-income investors who must position themselves in an uncooperative direction. Yet the consensus among analysts remains that a sustained drop in oil prices, not any single earnings report, is by far the most obvious route toward new highs for all three main indexes.
