Stocks closed higher on Thursday and for the week.

The U.S.-Iran Memorandum of Understanding (MOU) continues to lift stocks.

Granted, it's really just a framework to keep talking amid an expanded ceasefire. But traffic flow has opened up in the Strait of Hormuz (despite Iran saying otherwise). Traffic is still well below pre-war levels, but totals are the best since the war began.

And oil prices continue to fall.

While Vice President JD Vance on Friday cancelled his trip to Switzerland for continued MOU talks, Steve Witkoff and team landed in Switzerland on Saturday to resume negotiations. And it was announced later that JD Vance had joined them.

In spite of the repeated delays and rhetoric surrounding it all, it's become clear neither side wants the bombing to continue, and a diplomatic solution is preferred. And that's what the market has been responding to.

Additionally, even though last Wednesday's FOMC Announcement suggested a possible rate hike later this year, the fact that the war is ending and energy prices are falling, does cast doubt on whether that will happen.

Moreover, the Fed's Summary of Economic Projections (SEP) was still forecasting rate cuts to resume in 2027.

Although, it may come sooner, if oil continues its retreat. Oil has been the biggest contributor to the recent uptick in inflation.

We'll get another look at inflation on Thursday, 6/25, with the Personal Consumption Expenditures (PCE) index, which is the Fed's preferred inflation gauge.

But the real driver of the market, quite frankly, has been the resiliency of the economy, the increased productivity, and the impressive EPS growth (both actual and estimated).

We'll get another look at GDP this week as well, with the third and final estimate for Q1'26 GDP.

And we already know of the spectacular earnings growth: Q1'26 earnings season wrapped up earlier this month, and the results were stellar with a 25.5% EPS growth rate; Q2'26 earnings season is set to begin next month, and is forecast to show a 21.8% EPS growth rate; Q3'26 is forecast at 19.2%; and Q4'26 is forecast at 21.1%. Wow!

Combine that with the insatiable AI demand (this is the most transformational technology boom ever), and it's easy to understand why stocks continue to enjoy support.

We'll also hear from AI bellwether Micron on Wednesday, 6/24, when they report earnings after the close.

In the meantime, we'll see if the market can keep last week's upside momentum going this week.

Should be a busy week.

See you tomorrow,