Nasdaq opens higher as stocks continue despite Middle East war

“Oil prices have retreated slightly from 18-month highs amid rumors that Iran may be willing to negotiate with the United States to end the conflict,” noted Axel Rudolph, chief technical strategist at investment and trading platform IG.

“TTF gas prices fell 9% after a 60% gain this week while gold and silver prices recovered some sharp losses on Tuesday as the US dollar weakened slightly.”

U.S. services sector activity accelerated in February, with the Institute for Supply Management services PMI rising to 56.1, the highest level since 2022 and better than expectations for a reading of 53.5.

The stronger-than-expected print points to strong growth in the services economy, which makes up a large portion of US economic activity.

At the same time, inflationary pressures have shown signs of easing. The ISM Services Prices Paid Index fell to an 11-month low of 63, indicating moderation in input cost growth even as overall activity picked up.

US stock indexes opened broadly higher, after the Dow Jones slipped into the red briefly.

After half-hour trading, the Nasdaq was up 0.8%, the S&P 500 was up 0.4% and the Dow was up 0.2%.

Coinbase was the top riser on the S&P, with an 11.4% gain that led bitcoin’s return.

Robinhood Markets was next, up 8%, with others including Uplovin, Arista, Datadog, Western Digital and Seagate Technologies.

This morning, US Treasury Secretary Scott Besant repeated his president’s pledge that the US would try to help transport oil in the Gulf region.

Defense Secretary Pete Hegseth also said “more forces have arrived” in the region as Iran continued its retaliatory attacks on neighboring countries for a fifth day.

US media reported that the CEOs of US defense groups, including Lockheed Martin and RTX, were invited to the White House on Friday to discuss accelerating the production of missiles and other weapons, despite President Trump’s statement yesterday that the US has “virtually unlimited supplies”.

U.S. futures pointed to a flat opening on Wall Street on Wednesday, suggesting the mood is more of a bit of tired stability than any real conviction.

Dow Jones futures were up around 77 points, S&P futures were down 5 points and the Nasdaq was barely changed, minutes later the Nasdaq was up 0.2% and the Dow was back flat.

The picture changed significantly in the early morning hours and morning, with the futures outlook shedding deep losses before turning green during the European session, only to fade again.

There was some cause for some cautious optimism with gains in European markets, including a 1.75% rise for Germany’s DAX and a 0.8% return for the FTSE 100 in London.

The tentative tone follows a session when the Nasdaq led the decline, down 1% to 22,516.69, the Dow ended 0.8% at 48,501.27, and the S&P fell 0.9% to 6,816.63. All three indices recovered significant ground from their internal lows.

“Investors are grappling with the inflationary effects of rising oil prices,” said David Morrison, market analyst at Business Nation, as drone and missile threats from Iran have effectively shut down traffic through the Strait of Hormuz.

President Donald Trump said yesterday that the United States will provide risk insurance and potentially restore the flow of crude oil to tankers operating in the Persian Gulf. But he doesn’t seem to have done enough to calm his nerves.

Today sees the release of the ISM services PMI and the ADP private payrolls report ahead of Friday’s official non-farm payrolls.

On the corporate front, CrowdStrike shares are flat after overnight earnings, while today sees numbers from Bell, Abercrombie & Fitch, BrownForman and Okta followed by Broadcom.

Kenny Polcari at Slatestone Wealth noted that the VIX rose another 9% on the day, after already rising nearly 25%, and said markets “won’t completely calm down until the conflict in the Middle East ends.”