EL7.AI
StocksMediumUpdated•Originally published 30 June 2026•Updated 1 July 2026•
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S&P 500, Nasdaq Post Best Quarter Since 2020 Amid Middle East Tensions

Key Facts

1The S&P 500 and Nasdaq finished Q2 2026 with their biggest quarterly gains since 2020, as investor optimism about economic and earnings growth persisted despite the Middle East conflict.

Despite the ongoing war in the Middle East, US markets posted a standout quarterly performance highlighting investor confidence in economic fundamentals. The S&P 500 and Nasdaq finished Q2 2026 with their biggest quarterly gains since 2020, according to Reuters data, driven by optimism over economic growth and corporate earnings that outweighed the Iran conflict.

Fresh economic data reinforced the rally, with the final reading of Q1 GDP showing 2.1% growth (per market data), beating forecasts, while personal spending rose 0.7% in May, signaling strong consumer demand. The core PCE price index remained steady at 0.3% month-on-month, suggesting inflation pressures are contained.

With Q2's strong performance in the books, focus now shifts to the upcoming Q3 earnings season and the Federal Reserve's policy path. The key question is whether markets can sustain momentum amid lingering geopolitical risks and any shift in interest rate expectations.

Latest Updates · 1

  1. Minor·

    Update: Despite the strong quarterly performance, detailed data shows the S&P 500 had a difficult June 2026, slipping 1.1% to close at 7,500 per market data. That level is 18% above the year's low and just a few points below the all-time high of 7,613.