Energy leads stock rally as oil surges, economics and earnings to lead next leg up

Most markets rose on Wednesday.

The S&P 500 jumped 1.0 percent, the STOXX Europe 600 rose 0.6 percent but the Nikkei 225 fell 0.4 percent.

Energy stocks led gains as oil rose 3 percent following the US decision to pull out of the Iran nuclear deal and reimpose sanctions.

Even as investors focus on geopolitics, Kate Warne, investment strategist at Edward Jones, thinks that economics and earnings will give stocks their next leg up this year.

“We think first investors really aren't paying attention to the fact that the budget deal that went through Congress earlier this year adds government spending as a pillar for economic growth,” Warne told CNBC on Tuesday.

“Investors haven't paid enough attention to the really stellar first-quarter earnings we've seen,” added Warne.