Important Morning Note

Markets are celebrating Iran's announcement that the Strait of Hormuz is now fully open during the ceasefire... While the US, however, has stated that its blockade will continue as negotiations move forward.

We came into the year positioned for geopolitical tensions (tariffs included) abating -- and fiscal oomph appearing -- as the mid-term election approaches... In the meantime, the Iranian conflict of course has called the geopolitical element of our thesis notably into question, which in turns threatens the fiscal element... It's been estimated that, for example, higher gasoline prices will effectively absorb the record tax refunds that are now beginning to flow into consumer pockets.

We've maintained since day-1 that the duration of the conflict will ultimately dictate how we manage our allocation along the way... You (clients) have no doubt noticed (for portfolios [above 100k] that capture our full core allocation) the heightened frequency of adjustments we've made along the way... For the most part they -- particularly the most recent rotation and the addition of SPX call options -- have proved relatively timely... Which in no way has us taking anything for granted; this is an extremely fluid situation, subject to change on a dime (as you've noticed).

Here's your PWAI morning rundown:

Private Wealth Advisors  ·  Morning Note  ·  April 17, 2026

Market Update: Strait of Hormuz Opens

A pivotal macro development this morning — and what it means for your portfolio

S&P 500

+1.25%

Nasdaq

+1.30%

Dow Jones

+2.06%

Oil (WTI)

−10.5%

Iran's Foreign Minister announced this morning that the Strait of Hormuz is fully open to commercial shipping — the single most significant development since the conflict began in late February. Crude oil has fallen over 10% in response, with WTI trading near $81/barrel after opening the week above $100.

What happened

Since late February, U.S.-Iran tensions had pushed oil prices above $100/barrel and created meaningful uncertainty across global markets. Over the past two weeks, a combination of ceasefire signals, diplomatic progress, and a 10-day Israel-Lebanon truce had begun to ease that pressure. Today's Hormuz announcement is the market-moving confirmation investors were waiting for. Stocks have now fully recovered their conflict-related losses — the S&P 500 closed at a new record high yesterday and is extending those gains today. The Nasdaq has posted 12 consecutive positive sessions, its longest winning streak since 2009.

Portfolio positioning

Your portfolio was repositioned earlier this week to take advantage of exactly this scenario — rotating toward international equities, consumer discretionary, and technology. Those moves are contributing positively today. International developed markets (Europe) and emerging markets are rallying alongside U.S. equities as global risk appetite improves. Your energy holdings, which served as a conflict hedge through the elevated-oil period, are experiencing selling pressure today as crude prices decline — a natural and expected tradeoff given the improved geopolitical backdrop. Overall, your portfolio is participating in today's broad market advance.

Looking ahead

The weekend holds a planned round of U.S.-Iran peace negotiations, with President Trump indicating a permanent deal is within reach. A durable resolution would confirm the de-escalation trade and likely support continued strength in equities, particularly in economically sensitive sectors. We are monitoring energy prices closely — a sustained decline in oil has different implications than a temporary repricing — and we will reassess energy exposure accordingly. First quarter earnings season is also well underway, with results from major banks coming in ahead of expectations, providing an additional fundamental tailwind.