Stock markets traded recently to all-time highs on daily and weekly hopes that the U.S. bombing of Iran ended. Hopes of a peace agreement peaked when the two countries failed to come to any agreement. When negotiations ended, stock markets started selling semiconductor stocks first.
The swift shift from euphoria to fear for chip stocks like Marvell Technologies (MRVL), NVIDIA (NVDA), and AMD (AMD) is troubling. The chances are increasing that the panic will spread to the Magnificent 7.
Apple (AAPL) stock fell by around 6% in the last week after the firm announced Siri AI. With advanced AI features offloaded to Alphabet’s (GOOG) Google Gemini, fans were left unimpressed.
Microsoft (MSFT) lost 7% in the week and is -17.84% YTD. Meta (META) is faring poorly, too, down by 13.5% YTD.
The U.S. started another round of strikes on various targets in Iran. This lifted oil prices by around 2% to $92/bbl. Since WTI crude prices are hovering at $90 instead of $100, markets are still holding out on hopes that the escalation is minimal.
Shares of military contractors like Lockheed Martin (LMT), RTX (RTX), and L3Harris (LHX) are underperforming. That is another indication that markets do not take the war escalation warning seriously. Investors also took the chance to avoid speculative stocks like Kratos Defense (KTOS) and Red Cat (RCAT). RCAT stock has 21.28% in short float, so bears have a big bet that it will keep falling.
