FX.co ★ US market attempts to rebound. Prospects of US strike against Iran support oil prices

S&P 500

Overview for March 24

The US market is attempting to rebound

Major US indices on Friday: Dow: +0.1%, NASDAQ: +0.5%, S&P 500: +0.1%,S&P 500: 5,667, trading range: 5,500–6,000.

On the day of quarterly options expiration in the stock market, a negative sentiment prevailed.

However, the major indices did not reflect this at the close. The Dow Jones Industrial Average (+0.1%), S&P 500 (+0.1%), and Nasdaq Composite (+0.5%) closed at their best levels of the session, supported by a late-day surge in mega-cap stocks.

Apple (AAPL 218.27, +4.17, +2.0%) and Microsoft (MSFT 391.26, +4.42, +1.1%), which together make up as much as 13% of the S&P 500 by market capitalization, were among the best performers. Tesla (TSLA 248.66, +12.40, +5.3%), Meta Platforms (META 596.25, +10.25, +1.8%), and Amazon.com (AMZN 196.21, +1.26, +0.7%) also stood out in this segment.

Nevertheless, many stocks declined after disappointing reports and/or forecasts from companies such as FedEx (FDX 230.33, -15.88, -6.5%), NIKE (NKE 67.94, -3.92, -5.5%), Lennar (LEN 115.22, -4.85, -4.0%), and Micron (MU 94.72, -8.28, -8.0%).

This added to the market's existing concerns about economic growth, particularly how it aligns with revenue expectations.

The S&P 500 Equal Weight Index closed 0.5% lower, and eight out of 11 S&P 500 sectors ended in negative territory, with the largest declines seen in the real estate (-1.0%) and materials (-1.0%) sectors.

The materials sector was partly weighed down by shares of Nucor (NUE 122.01, -7.49, -5.8%), which issued a Q1 profit warning, as well as US Steel (X 40.90, -0.16, -0.4%).

The only sectors that closed higher were communication services (+1.0%), consumer discretionary (+0.6%), and technology (+0.5%), reflecting the positive performance of the mega-cap sector.

There were no major US economic data releases on Friday.

Looking ahead to Monday, market participants will receive the following economic data:

9:45 AM ET: Preliminary S&P US Manufacturing PMI for March (previous reading:52.7) and Preliminary S&P US Services PMI for March (previous reading: 51.0).

Year-to-date performance:

Dow Jones Industrial Average: -1.3%, S&P 500: -3.6%, S&P Midcap 400: -5.6%, Russell 2000: -7.8%, Nasdaq Composite: -7.9%

Energy sector: Brent crude: $72. Oil prices are caught between two forces: downward pressure from concerns over US economic performance and support from geopolitical tensions, especially Trump's threats of military action against Iran. Trump has issued an ultimatum to Iran: sign a deal to halt nuclear weapons development on US terms, or face strikes on its nuclear and military sites within two months.In recent weeks, Iran has publicly rejected such a deal at the highest political levels, increasing the likelihood of a US strike on Iranian nuclear and missile infrastructure.

Conclusion: The US market is weathering negative news with resilience and is trying to hold above recent lows. The likelihood of a new growth wave remains and it is recommended to keep holding long positions from one-year lows. Current levels also offer attractive buying opportunities for the S&P 500 index, particularly via the SPX instrument.