U.S. stocks have shown gains as Iran’s attack on a U.S. airbase in Qatar produced no casualties. Still, tensions threaten to escalate.
Major U.S. stock indices saw small gains despite the U.S. entry into Israel’s war with Iran. On Monday, June 23, Dow Jones was up 270 points or 39.98%, while the S&P 500 was up 0.69%. Tech-heavy Nasdaq was up 0.78%, boosted by growth stocks, while oil prices dropped 5%.
Nasdaq 100 heatmap | Source: TipRanks
The timing of the three U.S. strikes on major Iranian nuclear facilities, which happened when the markets were closed, may have muted a reaction. Oil also traded only slightly higher, despite fears that Iran may resort to drastic measures. This included the closure of the Strait of Hormuz, a vital global oil artery.
Still, traders braced for Iran’s response, and on June 23, the Iranian military reported that they had already launched a strike on the U.S. military base in Qatar. Qatar’s foreign ministry confirmed, but added that there were no casualties, as the U.S. evacuated its planes and personnel days ago.
Trump declares victory, threatens regime change
U.S. officials have already threatened severe consequences if Iran chooses to retaliate. Trump even talked about regime change, suggesting that Iranian Ayatollahs could be replaced with a democratic government.
Still, it is not yet clear whether or not the U.S. is committed to a full-fledged war with Iran. The effectiveness of the U.S. strikes on Iran, which President Donald Trump called a “spectacular military success,” still has to be assessed. Independent agencies saw no signs of elevated radiation.
The questionable effectiveness of the U.S. strikes, as well as Iran’s careful response, suggests that tensions may be de-escalating. For this reason, growth stocks were up, with Tesla gaining almost 10% after launching its Robotaxi service.
Still, the launch was not without its problems, with numerous riders reporting speeding and traffic law violations.