U.S. stocks regained their momentum on Wednesday, as President Donald Trump’s comments eased mounting tensions over Tuesday’s Iranian attack on U.S. troops in Iraq. Investors heaved a sigh of relief and focused on stocks again, resulting in the stock market’s upward trajectory.
The three major indexes— the Dow Jones Industrial Average, S&P 500 and Nasdaq Composite — closed in the green on Wednesday. Dow hit 28,745.09 after gaining 0.6%, the broader S&P 500 finished at 3,253.05 after rising 0.5% and the Nasdaq Composite closed at 9,129.24 after increasing 0.7%.
The fear-gauge CBOE Volatility Index (VIX) declined 2.5% to close at 13.45 on Jan 8. Finally, advancers outnumbered decliners on the NYSE by a 1.77-to-1 ratio.
Trump Calls for Renewed Diplomacy
Addressing the country on Wednesday, President Trump retreated from further military action against Iran in the aftermath of the Islamic Republic’s missile attacks on military bases housing U.S. troops in Iraq on Jan 7.
Trump said that no U.S. military personnel were harmed in the attack and the U.S. military bases sustained “minimal damage.”
The President also said that “Iran appears to be standing down” and it was a good thing for the world. In fact, he called for renewed diplomacy as he announced that the United States “is ready to embrace peace with all who seek it.”
Trump also spoke of issuing economic sanctions on Iran along with striking a new nuclear deal. He announced plans ask NATO allies to get more involved in the “Middle East process” as well. The president expected NATO to contribute to the region’s stability.
Trump’s statements came hours after Tehran indicated that it had “concluded proportionate measures” in order to avenge the assassination of its top military chief Qassim Suleimani last week.
Iran had launched 22 missiles on Tuesday at two large military bases in Iraq, which housed U.S. troops. However, the attacks appeared to have damaged the infrastructure and not the people stationed there.
The majority of the 22 missiles were aimed at Al-Asad, an air base in the desert of western Anbar and five of the missiles were aimed at an air base in the capital of Iraqi Kurdistan, Erbil.
The Joint Command in Baghdad, which comprises both Iraqi and international representatives, issued a short statement on the morning of Jan 8, saying that neither coalition nor Iraqi forces had “recorded any losses.” You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Crude Oil Slumps on Trump Comments
Oil prices took a dip on Wednesday, owing to Trump’s speech that cooled the tensions concerning Iran. Oil prices hit lowest settlement since mid-December.
West Texas Intermediate crude oil on the New York Mercantile Exchange for February delivery fell 4.9% to settle at $59.61 a barrel on Jan 8. March Brent crude lost 4.2% to hit $65.44 a barrel on ICE Futures Europe on Wednesday.
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