1) Last night, the U.S. and Iran announced a peace deal to end the war. As a result, stocks are up today, and the price of oil is falling.
Since the start of the war on February 28, the S&P 500 Index is up 8%. I hope my readers listened to me when I said to "ignore the headlines and stay the course"...
On March 9, I wrote that several family members expressed concerns about the effect of the war on their retirement accounts. Here was my advice:
I told them that they have a multidecade investment horizon. When placed in that context, the latest turmoil in the world – and the markets – is completely irrelevant.
I strongly recommended that they only look at their portfolio once a year, and we would review it together then.
Finally, I reminded them that 99% of the time, long-term investors should ignore the headlines and stay the course.
But is today one of those 1% times? I don't think so...
Then on March 10, I explained why I thought the Iran war would end soon:
... the Iran war is entirely within the [President Donald Trump's] control. He started it suddenly – and can end it just as quickly.
Midterm elections are coming up, prices Americans are paying at the pump are rising sharply, and his approval rating is in negative territory. So it's clear to me that he's going to declare victory in the Middle East in the near future, which will likely trigger another relief rally.
In subsequent days, I reiterated my bullishness on the market despite the news:
- "History shows investors should stay the course" (March 12)
- "More on the market's reaction to the Iran war" (March 13)
- "I'm yawning at the current market turmoil" (March 25)
- "Ignore the short-term noise" (April 2)
- "I remain bullish on AI and the overall market" (April 13)
It took a little longer than I expected, but my prediction from March 10 is exactly what happened.
The lesson here is clear: 99% of the time, long-term investors should ignore the headlines and stay the course.
2) Even before the peace deal news, the market was on a tear. Why are stocks doing so well right now? To quote James Carville, "It's the economy, stupid."
As this chart from Charlie Bilello's Week in Charts shows, there has been a dramatic turnaround in the U.S. labor market:
Over the past six months, 92,000 jobs have been added per month on average. That's the strongest six-month rate since February 2025... and an incredible improvement from the start of 2026.
Corporate earnings are booming as well, as shown in this chart Bilello posted on X:
The S&P 500's earnings per share ("EPS") are expected to jump 24% this year. According to Bilello, the market has never seen EPS growth this high outside of postrecession rebounds.
Lastly, this chart from Ritholtz Wealth Management's Ben Carlson shows the longer-term trend for EPS in the markets, dating back to 2000:
In summary, stocks are richly priced, but they're not in bubble territory – and their valuations are supported by strong underlying fundamentals.
So right now is a great time to look for bargains in out-of-favor stocks and sectors.
Three major sectors – consumer staples, healthcare, and financials – are testing multidecade valuation lows relative to the rest of the market.
You can see the comparison in this chart, posted by WisdomTree's Jeff Weniger on X:
I love dislocations like this because they provide opportunities to buy the beaten-down stocks of high-quality companies.
3) Speaking of which, I've decided to change the "Out-of-Favor 10" to the "Discarded Dozen"...
I'm adding two more stocks to the list I named on Friday:
- Footwear and apparel giant Nike (NKE) – covered on April 1
- Fashion company Prada (PRDSF) – covered on April 23 and May 20
I'm confident that this list, on average, will outperform SpaceX (SPCX) and the overall market, as measured by the State Street SPDR S&P 500 Fund (SPY), over the next year.
Here's the table I'll be using to track this prediction (recent prices are from shortly after the market opened this morning):
Every one of these Discarded Dozen stocks trades at or near multiyear lows (in some cases, multidecade lows). All of them generate gobs of free cash flow, and most are buying back shares hand over fist.
I'll be periodically updating this table to track the returns and see just how much my list can outperform SpaceX... Stay tuned.
As a last note, Global Payments (GPN) and ServiceNow (NOW) are both open recommendations in our flagship newsletter, Stansberry's Investment Advisory. Only subscribers have access to the full reports and specific buy-up-to advice on these stocks.
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Best regards,
Whitney
P.S. I welcome your feedback – send me an e-mail by clicking here.