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SPACS are back. Bitcoin’s riding high. Nvidia’s (NVDA) market cap is $3.8 trillion. Imminent or at least soonish rate cuts are back on the table. And the S&P 500 (^GSPC) is flirting with a new closing record amid tech optimism.

Stripped of context and isolated from worrisome headlines, you’d think the market was operating in a different time period. But here we are. The news environment and political moment matter, of course, as this latest bout of unleashed animal spirits is a reaction to shrinking negative catalysts and the dissolving of some of the most troublesome uncertainties.

The current pivot back to 2024 market narratives has been a sharp one, and the week’s Fed drama was bolstered by a pair of readings Thursday: A weaker first quarter GDP estimate than was previously reported and fresh labor data bolstered the case that it’s getting tougher for people out of a job to find work.

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The updates appeared to convince more investors that the Fed will speed up rate-cutting plans to address deteriorating economic conditions.

Market bets are welcoming the “bad news” with open arms because it means there’s a chance the first rate cut could arrive as soon as July, and if not, almost certainly by September, and because that “bad news” comes as the unemployment rate is still — as Powell is wont to remind the public — at a historically low 4.2%.

The dovish turn coincides with a sentiment shift that the tariff impact will be more muted than originally thought. And market optimism has been jolted as Wall Street interprets the hostilities between the US and Iran as on a path to deescalation.

“The stock market is back at record highs as various uncertainties start to fade,” said Paul Stanley, chief investment officer at Granite Bay Wealth Management, in a note Thursday. “The market is betting on continued progress on trade and a de-escalation of tensions in the Middle East is giving investors confidence.”

But as Stanley and others point out, even as the market reaches for new highs, it’s unclear what the next major catalyst could be with last quarter’s major obstacles out of the way. If so much of the positive momentum flowed from the collapse of worst-case scenarios, focus now goes to the positive ones. And there certainly are plenty to count. Fed cut speculation could turn into an actual Fed cut — or Fed cuts. The Magnificent Seven could get their mojo back and turn around a rough year. More trade deals could emerge instead of trade war pauses.