NASDAQ

Hi, this is NorthRay.🆕

Remember when I told you I wanted to buy Apple but couldn't because the market was closed?

Then I opened a trade on the SPX (the S&P 500 index). It closed with a small profit.

And that got me hooked.

Because there's something almost magical about indices. You buy one thing—and instantly get exposure to hundreds of companies. You don't have to guess whether Apple will soar or Tesla will fall. You're simply betting on the entire U.S. economy.

Spoiler: I liked it.

Today I'll explain what indices are, how they work, and why I now watch them almost as often as EUR/USD.

An index is a basket of stocks.

Instead of buying 500 individual stocks, you buy one instrument—the index—and it moves according to the average performance of the companies inside it.

Here's a simple analogy:

Imagine you're a teacher. You don't need to know how every student performed on an exam. You only need to know the class average.

If the average score is high, the class did well. If it's low, the class struggled.

An index is basically the average score of a group of companies.

Some companies inside the index may be rising while others are falling. The index shows the overall result.📉

There aren't that many. I learned five of them, and that's enough to get started.

I've traded both individual stocks (Apple) and indices (S&P 500). Here's what I've learned.

A single company can drop 10–20% because of one bad news story: a management scandal, a failed product launch, or a lawsuit.

An index made up of 500 companies is less likely to suffer such...

Thursday evening on the U.S. stock market was marked by a wait-and-see mood. S&P 500 futures gained a symbolic 0.1%, while the Nasdaq and Dow Jones remained virtually unchanged. This stillness may seem dull on the surface, but it conceals enormous tension. The market has just closed at record highs for the second consecutive session. The S&P 500 reached 7,563 points, while the NASDAQ Composite surged to 26,917. Such milestones are usually celebrated, yet traders are in no hurry to pop champagne today. They are waiting. Waiting to see whether the ceasefire with Iran holds. Waiting for what Trump will say. Waiting for inflation to finally begin easing. And in that waiting lies the essence of the current market environment.

The main catalyst behind the rally that pushed indexes to record highs was reports that the United States and Iran had reached a preliminary agreement to extend the ceasefire for sixty days. Axios reported that the deal includes reopening the Strait of Hormuz, which would represent a major breakthrough after months of conflict. The market reacted immediately and enthusiastically. Oil prices moved lower, while equities moved higher.

The logic behind the move is straightforward. Reopening the strait means restoring oil supplies. Restored supplies mean lower energy prices. Lower energy prices mean reduced inflationary pressure. Reduced inflation means the Federal Reserve may not need to continue tightening policy—or could even begin considering easing. And easier monetary policy is a favorable environment for equities, especially technology stocks, whose future earnings are discounted at lower rates.

Yet the market is experienced enough to understand that a wide gap exists between a preliminary agreement and lasting peace. The proposed deal still requires President Trump’s approval. Trump is known for unexpected policy shifts. Meanwhile, Iranian media...