U.S. Markets open in 1 hr 55 mins

The Markets Keep Their Head Following Iran's Retaliation

Daniel Laboe

Tehran launched around 20 ballistic missiles at 2 US bases in Iraq Tuesday evening. This attack was retribution for the US’s assassination of Iran’s top general Qassam Soleimani.

S&P 500 SPY futures initially sold off over 1.6% following the attack but quickly retraced to positive levels. Today the stock market is hitting all-time highs, and oil USO prices are down almost 5%, leaving some retail investors bewildered.

The primary explanation for this market reaction is that the retaliation was not meant as an initiation of war. There were no US casualties in last night’s attack because Iran wasn’t aiming to kill. Iran only wanted to flex its muscles and show that they could kill American’s if they wanted.

In the eyes of the market, this was tit-for-tat and would be the end of this conflict. Following President Trump’s address this morning, the markets pushed even higher touching fresh all-time highs. Trump reassured the markets that there would be no further military strikes on Iran.

Despite the US closing the books on this, Iranian’s Supreme Leader said this was not the end of its retaliation. Whether this is the end of the US-Iran conflict remains to be seen, but for now, the markets have priced in peace.

The Hottest Tech Mega-Trend of All

Last year, it generated $24 billion in global revenues. By 2020, it's predicted to blast through the roof to $77.6 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.

See Zacks' 3 Best Stocks to Play This Trend >>
 


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
United States Oil Fund, LP (USO): ETF Research Reports
 
SPDR S&P 500 ETF (SPY): ETF Research Reports
 
To read this article on Zacks.com click here.
 
Zacks Investment Research