Wall Street’s bulls charged ahead Friday. The S&P 500 and Nasdaq Composite notched fresh records. The Dow lagged, just 1.9% shy of its peak. All this, as the U.S.-Iran war nears its ninth week.
Investors appear done with the drama. U.S.-Iran talks loom over the weekend. Military ops in the Persian Gulf might ease. Markets shrugged it off. “This is a market that’s anxious—or simply tired of—the ups and downs of this conflict,” said George Catrambone, head of fixed income for the Americas at DWS via MarketWatch.
The conflict kicked off February 28. U.S. and Israel struck first. Iran hit back. Jet-fuel shortages cripple airlines abroad. U.S. households? Gas prices stay tame enough for tough talk. President Trump figured stocks would tank 20%. They didn’t. Crude hovers near $100 a barrel. Fears of $200 linger if the Strait of Hormuz stays choked.
But tech steals the show. Megacap earnings beckon next week. Goldman Sachs pegs $4.5 trillion in AI data-center spending through fiscal 2030. Meta slashes 8,000 jobs to chase that boom. White-collar cuts mount. Growth persists.
Oil Spikes, Defense Surges—Then Fades
Early war days painted a different picture. Energy stocks rocketed. ExxonMobil, Chevron, ConocoPhillips climbed as West Texas Intermediate jumped 6%. Defense names like Northrop Grumman soared 6% in one session, Lockheed Martin and RTX followed. Palantir gained nearly 6% on government ties, per Investopedia.
Airlines plunged. Delta, United, American dropped 2-4%. Cruises tanked: Norwegian 11%, Carnival 8%. Travel felt the pinch. Travel-related like Booking Holdings and Marriott slid too.
Oil tankers boomed. The Breakwave Tanker Shipping ETF (BWET) surged over 600% year-to-date. Far outpacing crude’s 60% gain, as Hormuz disruptions jacked freight rates, according to CNBC.
And then? Markets adapted. Ceasefires sparked relief rallies. A two-week truce sent stocks up, oil below $100. Nasdaq hit highs post-extension. Investors rotated back to risk assets. Global indexes clawed back war losses, fueled by AI hype, CNBC reports.
Asia shrugged too. Japan’s Nikkei and South Korea’s Kospi hit records Monday, ignoring stalled talks. Oil elevated, but local growth won out.
Jim Cramer nailed it. Markets ignore Iran for bigger forces: resilient economy, Fed path, earnings. Even Hormuz closures barely dented sentiment, via CNBC.
Why the Shrug? AI Bets Trump Geopolitics
Forward-looking. That’s stocks. Bettors eye quick resolutions. History backs it: shocks jolt, then fade. S&P 500 nearly erased war dips. Optimism outpaces oil worries, CNBC notes.
U.S. assets shine brighter. International stocks battered early. MSCI AC World ex-USA trailed S&P by 5.91 points over three days post-strikes, MarketWatch.
Emerging markets exposed. Asia-heavy ETFs, 80% China-Taiwan-India-Korea, swung wild on energy imports. South Korea’s tech ate costs. Concentration risk? Not in S&P, but abroad, per CNBC.
Longer scars possible. Energy stays above pre-war. Gulf damage lingers. Investors warn of Wall Street marks, Financial Times.
Volatility lurks. VIX spiked early. Patriot stocks dwindle. Iran eyes tankers, bases. UBS flags reversals in size, style, quality trades if Hormuz clogs weeks more, Yahoo Finance.
Yet records mount. Nasdaq, S&P push limits. Tech insulated. AI capex rolls. War? Distant noise. Investors bet on earnings, innovation. Tension tests nerves. Markets look past. For now.
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