The Market's Best Day Since April

After last week's pullback, the market came back strongly today. The S&P 500 rose 2.35% to 7,550, its best day since April. The Dow gained 2.15%, while the Nasdaq climbed 2.74%. All eleven sectors finished higher.

Oil led the recovery, with Brent crude falling more than 6% to $92 as concerns over further strikes on Iran eased. Chip stocks also bounced back. AMD gained 13.3% and Broadcom 8.8%, while Nvidia fell 4.3% on company-specific news.

But one strong day does not erase last week's losses. The S&P 500 remains below its November 4 close. Tomorrow's October inflation report will be another important test ahead of the Fed's December meeting.

I have seen this pattern before. A bad week creates doubt, and one strong day brings back confidence. But neither tells us the whole story. The underlying businesses did not change last week, and they did not suddenly change today.

Patience means staying disciplined in both directions. A green day should not make us overly confident, just as a red day should not make us lose conviction. The market moves with sentiment, but our decisions should be guided by what is actually changing beneath the surface.