Nasdaq set to gain as chips in favor again, as oil rebounds

• The US struck 90 additional Iranian targets (170 total in 48 hours), while Iran retaliated with attacks on US military sites in Bahrain, Qatar and Kuwait
• A rotation within tech stocks saw chip stocks like SanDisk and Nvidia gaining in pre-market trading while hyperscalers like Microsoft and Alphabet declined
• Oil prices remained volatile between $72-$75 per barrel, with markets 'normalizing' to Middle East tensions despite White House preparing for potential weeks-long fighting around the Strait of Hormuz

Market Summary: Nasdaq Set to Gain on Chip Rally Amid Middle East Tensions

Market Performance:

US futures showed mixed signals Thursday morning, with Nasdaq 100 futures up 0.8%, S&P 500 futures rising 0.2%, and Dow Jones futures down 0.1%. This follows Wednesday's session where the Dow fell 577 points (-1.1%), the S&P declined 0.3% to 7,483, and the Nasdaq gained 0.2% to close at 25,871.

Key Sector Focus:

A notable rotation is occurring within technology stocks, with investors moving from broader tech into semiconductor stocks. Analysts expect continued rallies in chip names like SanDisk and Nvidia, while hyperscalers including Microsoft and Alphabet declined in pre-market trading, signaling a shift within the AI trade.

Oil Market Volatility:

WTI crude prices remained volatile, fluctuating between $72 and $75 per barrel amid escalating US-Iran tensions. The US reported striking 90 additional Iranian targets, bringing the 48-hour total to 170 strikes. Iran retaliated with attacks on US military sites in Bahrain, Qatar, and Kuwait. President Trump indicated Iran wants to negotiate, though he expressed skepticism about potential agreements. The White House is reportedly preparing for potential extended conflict around the Strait of Hormuz lasting days or weeks.

Market Implications:

Analysts at XTB noted markets are "normalizing" to Middle East tensions, suggesting resilience despite geopolitical risks. The rotation from broader tech into semiconductors indicates investor confidence in chip stocks specifically, even as geopolitical uncertainty persists.

Economic Data:

Initial jobless claims and existing home sales data are scheduled for release Thursday.