Markets rallied sharply after the U.S. paused military action against Iran, triggering a broad risk-on move across global assets.
Stocks Surge As Risk Sentiment Rebounds
U.S. stock futures jumped early Wednesday after President Donald Trump announced a two-week suspension of attacks on Iran. Dow futures rose 1,056 points, while S&P 500 and Nasdaq 100 futures gained 2.45% and 3.2%, respectively.
U.S. Big Tech giants Meta Platforms Inc. (NASDAQ:META), Apple Inc. (NASDAQ:AAPL), Amazon.com Inc. (NASDAQ:AMZN), and Alphabet Inc. (NASDAQ:GOOGL) opened higher in premarket trading on Wednesday as investors pivoted back into equities.
The gains extended across the semiconductor space, reversing earlier-week losses. Nvidia Corp. (NASDAQ:NVDA), Advanced Micro Devices Inc. (NASDAQ:AMD), Broadcom Inc. (NASDAQ:AVGO), Intel Corp. (NASDAQ:INTC), Arm Holdings Plc (NASDAQ:ARM), Marvell Technology Inc. (NASDAQ:MRVL), Taiwan Semiconductor Manufacturing Co. Ltd. (NYSE:TSM), Micron Technology Inc. (NASDAQ:MU) and ON Semiconductor Corp. (NASDAQ:ON) gained in tandem.
Global equities followed, with Asian and European markets posting strong gains as investors welcomed the reduced risk of escalation and rotated back into equities.
Jay Woods, chief market strategist at Freedom Capital Markets, told CNBC on Wednesday that the move was partly anticipated, noting, “It wasn’t much of a surprise that there was an announced reprieve in the Iranian conflict.”
“The market has gotten much better at sniffing out” Trump’s next move. He added, “The concern now is if this all too familiar ‘two-week’ timeframe is going to lead to a resolution.”
Oil Plunges As Energy Supply Fears Ease
Crude prices dropped sharply after the ceasefire announcement, with West Texas Intermediate falling more than 15% and Brent crude losing over 13%, both slipping below $100 per barrel.
The decline came as the agreement raised expectations that the Strait of Hormuz—a key global energy route—would reopen, easing supply concerns that had driven oil prices higher during the conflict.
Koen Hoorelbeke, investment and options strategist at Saxo Bank, told the Wall Street Journal on Wednesday, “The geopolitical risk premium that had accumulated over 26 trading days of conflict is now unwinding at speed.” However, he cautioned that a two-week ceasefire “does not constitute a durable resolution.”
Price Action
In Wednesday’s premarket session, major tech and chip stocks rallied, with Meta Platforms jumping 4.86% to $602.99, Alphabet gaining 4.14% to $318.11, Nvidia rising 3.77% to $184.81, Broadcom climbing 5.34% to $351.80, and Marvell Technology surging 6.66% to $116.67, according to Benzinga Pro data.
Photo by Andrey_Popov via Shutterstock
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