Stock Market Today, April 17: Oil Prices Drop As Strait of Hormuz Reopens

The S&P 500 (^GSPC +1.20%) rose 1.20% to 7,126.06, the Nasdaq Composite (^IXIC +1.52%) gained 1.52% to 24,468.48, and the Dow Jones Industrial Average (^DJI +1.79%) advanced 1.79% to 49,447.43 as easing Middle East tensions drove fresh highs.

Market movers

Exxon Mobil (XOM 3.65%) and Chevron (CVX 2.21%) sank roughly 3.7% and 2.2%, respectively, as big oil stocks fell on plunging crude prices. Airline and travel stocks, such as American Airlines Group (AAL +4.16%) and Royal Caribbean Cruises (RCL +7.22%), gained.

Netflix (NFLX 9.72%) tumbled 9.7% on a downbeat revenue outlook and news that its co-founder would step down. Apple (AAPL +2.65%) climbed on stronger China iPhone demand, and Ally Financial (ALLY +8.10%) soared following positive Q1 earnings.

What this means for investors

WTI crude oil fell by over 10% to close at $84.68 a barrel today after the Iranian Foreign Minister announced the reopening of the Strait of Hormuz. The vital waterway has been blocked for over six weeks, pushing up energy prices and pressuring stocks.

Negotiations for a lasting peace deal continue, but optimism about a potential resolution powered markets. The S&P 500 has erased its war-related losses and set new highs, closing the week with gains of almost 5%. The rapid turnaround is a reminder of the importance of staying invested through geopolitical turmoil, as it can be almost impossible to predict when sentiment will shift.

Tech stocks also climbed, and the Nasdaq notched its 13th consecutive day of gains. Advanced Micro Devices (AMD 0.03%) and Microsoft (MSFT +0.60%) both posted significant gains this week, buoyed by broader optimism.