Cease-fire means the bottom is in, declares strategist Tom Lee

By Jules Rimmer

A move above the 200-day on the S&P 500 paves the way for a decisive move up

World stock markets - and the Iranian people - greeted the news of a truce agreememt warmly

Strategist Tom Lee thinks the newly-announced cease-fire between the U.S and Iran obviates a punitive bombing campaign and means "the bottom is in" for the stock market. Should the S&P 500 index SPX break back up above its 200-day moving average then "a decisive move higher" is likely.

The 200-day average for the index, an important technical indicator for the market, currently stands around 6617, according to the co-founder and head of research at Fundstrat. The E-mini S&P 500 futures continuous contract (ES00) is already trading way in excess of that on Thursday morning, up nearly 2.5% at 6820.

The S&P 500 index regaining its 200-day average would be a positive technical indicator, says Tom Lee

Lee was making his points during his daily 'macro-minute' recap in which he explained the rationale for his optimism about stocks and reiterated his enthusiasm for Mag7 MAGS , bitcoin (BTCUSD), Ethereum ETHE as well as energy XLE and basic material XLB shares, although these latter, he conceded, may struggle in the short-term given the significant drop in oil prices overnight.

Lee also is chairman of a company, BitMine Immersion Technologies, that buys Ethereum.

Not everyone is as sanguine about prospects for a lasting truce as Lee. Tom Holland, deputy global research director, at Hong Kong-headquartered fund management and research house Gavekal, expressed some skepticism around the peace deal. In a note to investors published Wednesday, his reservations were focused chiefly on the clear disparity between the statements made by the Americans and the Iranians in the immediate aftermath of the announcement.

The fifteen-point peace plan offered in March by the White House differs starkly from the 10-point plan outlined by a news agency close to Iran's Supreme National Security Council. Holland is one of many observers questioning the plausibility of shipping traffic through the Strait of Hormuz returning to its pre-war levels any time soon.

Most notably, Holland predicts, oil (BRN00) prices are set to retain a lofty premium to the levels observed earlier in 2026, given lingering risks and uncertainties.

-Jules Rimmer

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04-08-26 0500ET