The TACO Trade Is Alive: S&P Hits Records While the World Is Literally on Fire

The S&P 500 and Nasdaq both closed at all-time highs on Sunday, putting the index on track for its best month since 2020 — all while the Strait of Hormuz sits at 5% of normal flow, an assassination attempt went down at the White House Correspondents' Dinner, and Brent crude is trading at $108-109. Welcome to 2026, where 'peak uncertainty' is apparently a buy signal.

The engine driving this rally? AI, obviously. The Philadelphia Semiconductor Index is up 37% in April alone after an 18-day winning streak, with $MU and $SNDK surging on Melius Research buy initiations. Meanwhile, Anthropic and OpenAI are collectively running at ~$70 billion in annualized revenue — more than double from the start of the year — which is doing a lot of heavy lifting for the 'AI capex is justified' thesis heading into a monster earnings week for the hyperscalers.

The one genuine bear case? Goldman just hiked oil forecasts again, projecting $90 Brent by Q4 base case, with an adverse scenario that would make your gas bill cry. Adam Parker over at Trivariate is flagging investor complacency on sticky oil — and he's not wrong that a consumer squeeze at the pump doesn't show up in earnings until it really, really does.

Seventy days of Hormuz disruption, a record-setting semiconductor index, and the Fed holding rates — the market's message is clear: it's not ignoring the chaos, it just thinks it's already priced it in. History suggests that's either genius or the last thing bulls say before things get interesting.