Nasdaq 100 and S&P 500: Tech Stocks Rise While Energy and Defense Lead the Charge

S&P 500 Remains Flat as Geopolitical Tensions Grow

The S&P 500 remained largely unchanged on Wednesday, posting a two-sided trade most of the session, as market momentum stalled due to rising tensions in the Middle East. The Dow Jones Industrial Average is also swinging on both sides of unchanged, while the Nasdaq Composite remained the most stable. Despite moderate market activity, concerns about the potential economic fallout from escalating conflicts weighed on investors.

At 17:34 GMT, the Dow Jones Industrial Average is trading 42121.14, down 35.83 or -0.09%. The S&P 500 Index is at 5700.60, down 8.15 or -0.14% and the Nasdaq Composite is trading 17904.09, down 6.27 or -0.04%.

Geopolitical Risks Impact Market Sentiment

Investor confidence was tested following the launch of ballistic missiles by Iran on Israel, which dampened risk appetite across global markets. Additionally, the prospect of Israel expanding its military operations into Lebanon and the involvement of Hezbollah has created further uncertainty. Market participants are bracing for continued volatility as geopolitical risks show no signs of abating.

West Texas Intermediate (WTI) crude oil prices were steady after a sharp rise on Tuesday, prompted by concerns that the ongoing conflict could disrupt oil supplies.

Energy stocks performed well, with the Energy Select Sector SPDR Fund (XLE) advancing for the fourth consecutive day, supported by gains in major players like Exxon Mobil and Williams Companies.

Corporate Updates Stir Volatility

Several high-profile stocks made significant moves in the market on Wednesday. Nike shares dropped by over 5% after the company withdrew its full-year guidance ahead of an upcoming CEO transition. Tesla also saw a 3% decline following underwhelming third-quarter delivery figures. Despite these setbacks, Nvidia managed to recover some of its losses from earlier in the week, rising by 1.5% as demand in the semiconductor sector stabilized.

Humana suffered the biggest hit of the day, with shares plunging 17% after it released concerning data related to its Medicare Advantage plans. The healthcare giant warned that a significant portion of its members may not qualify for top-rated plans in 2025, prompting its worst single-day performance since 2009.

Chinese Stock ETFs Rally Amid Stimulus Optimism

Chinese stock ETFs listed in the U.S. continued to rally as stimulus measures announced by Beijing helped boost sentiment in otherwise weak markets. Popular ETFs such as the KraneShares CSI China Internet ETF (KWEB) and iShares MSCI China ETF (MCHI) rose by at least 5% during Wednesday’s session. This marked the fifth consecutive day of gains, fueled by optimism over China’s economic recovery initiatives.

Market Forecast: Caution Ahead of Economic Data

Looking ahead, the market is expected to remain cautious as traders focus on upcoming economic data. The release of U.S. nonfarm payroll figures on Friday will be a critical factor influencing the Federal Reserve’s next policy move.

While Wednesday’s ADP report showed stronger-than-expected job growth in September, any signs of labor market strength could pressure the Fed to hold off on further rate cuts. In the short term, market volatility may persist, especially with geopolitical tensions adding an additional layer of uncertainty.

Traders should monitor energy prices and defense stocks as potential safe havens during this period of instability.