Stock Market Update

[BRIEFING.COM] Stocks are having an eventful start to the week in their first session of March, with strong tech gains helping the S&P 500 (+0.1%), Nasdaq Composite (flat), and DJIA (flat) overcome broader weakness that resulted from the U.S.-Iran conflict. 

The major averages opened considerably lower this morning following the weekend's geopolitical developments, which saw the U.S. and Israel launch strikes against Iran, killing many of its top government and military officials. Iran launched attacks of its own on bases in several nearby nations and declared the Strait of Hormuz closed. Oil prices rose sharply, and while crude is now off of its earlier highs, it remains $3.56 (+5.3%) higher at $70.58 per barrel. 

The energy sector (+1.3%) is unsurprisingly the top mover today amid the spike in oil prices. Though the higher prices and disrupted international travel weigh on airline names such as United Airlines (UAL 103.41, -2.89, -2.72%), the weakness is offset by solid gains across defense names such as Axon (AXON 571.89, +29.49, +5.44%) and Northrop Grumman (NOC 753.05, +28.67, +3.96%), helping the industrials sector (+0.8%) trade higher. 

While the top-weighted information technology sector (+1.0%) is the only other S&P 500 sector to hold a gain, it is wide enough to push the major averages to a mostly higher standing. 

Palantir Technologies (PLTR 146.50, +9.31, +6.79%) is a standout amid the conflict in Iran, while the broader software space also seems to be garnering some buying interest today, pushing the iShares GS Software ETF 1.6% higher. 

Investors are also stepping in to buy recent weakness from NVIDIA (NVDA 182.78, +5.59, +3.16%) after the stock rolled over following its earnings report last week. 

Though weakness elsewhere remains relatively broad, most sectors have seen at least modest improvements throughout the session. The financials sector (-0.1%) has shed nearly all of its losses that exceeded 1.0%, with a 5% rebound in Bitcoin boosting Coinbase Global (COIN 183.48, +7.62, +4.34%) and Robinhood Markets (HOOD 79.27, +3.42, +4.51%). 

Meanwhile, the consumer discretionary sector (-1.1%) remains a laggard, with particular weakness across travel-related names. Norwegian Cruise Line (NCLH 22.67, -2.12, -8.56%) is one of the worst-performing S&P 500 names after a revenue miss and cautious guidance. 

Outside of the S&P 500, the Russell 2000 (+0.6%) and S&P Mid Cap 400 (+0.6%) now outperform after shedding early losses of their own. 

So far the market has shown resilience despite a sharp escalation in geopolitical conflict over the weekend. President Trump told reporters that U.S. operations, which were initially expected to last four to five weeks, are ahead of projected timelines. Any indications that the conflict could drag out longer than expected could weigh negatively on the market, but for now, a solid rebound in tech sentiment helps outweigh the consequences of rising oil prices at the index level. 

Reviewing today's data:

• February S&P Global U.S. Manufacturing PMI - Final 51.6; Prior 51.2
• February ISM Manufacturing Index 52.4% (Briefing.com consensus 52.1%); Prior 52.6%
  • The key takeaway from the report is the faster pace of growth in the Prices Index, as that will fuel concerns about sticky inflation pressure (and the Fed sticking with its current policy rate for longer).