A broad-based market rally has gained momentum since March 30, with S&P 500 growth index surging 16% and emerging market stocks leading gains. The rally spans US small caps, European and Japanese equities, suggesting a general reversal rather than just tech-driven momentum. Lower interest rates have loosened monetary conditions, boosting speculative assets like bitcoin and gold while weakening the dollar.

Interest rates peaked on March 30, with the 10-year Treasury yield falling and creating a favorable environment for risk assets. The weaker dollar has particularly benefited emerging markets, as capital flows reversed from previous outflows. The Magnificent Seven tech stocks accounted for 60% of S&P returns during this period, though the rally appears broader than just tech sentiment reversing.

Market sentiment shifted as worst-case war scenarios were gradually priced out, with the Vix index returning to pre-conflict levels and oil prices falling. Valuations became more attractive, with the market briefly trading under 20 times earnings for the first time since last year's sell-off. This broad-based recovery suggests investors are betting the Strait of Hormuz blockade won't persist indefinitely.