The main US stock market indices opened flat on Tuesday as oil prices traded above $70 per barrel amid the uncertainty surrounding the ongoing crisis in Middle East. While Dow Jones is headed for the best first half in five years, Nasdaq will likely post the best quarter since 2020.
Nasdaq rose over 115 points at open at 25,935 level, S&P 500 was up 0.10% to open at 7,448.48, whereas the Dow Jones Industrial Average slipped 0.22% to 52,065.03 shortly after open.
Oil prices ticked slightly higher, with US West Texas Intermediate futures hovering around $71 a barrel and international benchmark Brent crude trading near $73 a barrel. This commodities uptick coincided with pressure in the financial sector after Oppenheimer downgraded several key investment banks.
Specifically, Goldman Sachs and Morgan Stanley both fell more than 1% after being moved from perform to underperform, while Bank of America and Citigroup similarly declined over 1% each following a downgrade to perform from outperform.
Despite these banking headwinds, equities rallied strongly on Monday as a pause in hostilities between the U.S. and Iran lifted overall market sentiment, driving the S&P 500 up 1.18% and the Nasdaq Composite up 2.07%. This momentum carried into Tuesday, which marks the final trading day of both the second quarter and the first half of the year.
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For the first six months, the Dow and S&P 500 have each climbed more than 8%, putting the Dow on pace for its best first-half performance since its 12.7% jump in 2021, while the tech-heavy Nasdaq has outpaced them with an 11% advance.
This strong mid-year standing comes in spite of a highly volatile start to the year. While the major averages repeatedly hit all-time highs, they did so while navigating wild swings in energy prices caused by the Iran war and intense market uncertainty regarding the sustainability of AI infrastructure spending.
However, the second quarter proved to be exceptionally robust for stocks as geopolitical tensions neared a resolution and anxiety surrounding the AI trade steadily eased. Consequently, the S&P 500 and Nasdaq surged roughly 14% and 20% for Q2, tracking toward their biggest quarterly gains since the second quarter of 2020, while the Dow gained more than 12% to secure its strongest quarter since late 2022.
On the currencies front, the Dollar Spot Index fell weakened and rose 0.2%, whereas euro rose 0.2% to $1.1397 and British pound fell 0.3% to $1.3220; The Japanese yen fell 0.3% at 162.43 per dollar.
Bitcoin, the largest traded cryptocurrency, fell 2.9% to $58,460.68.
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