US stocks traded higher on Wednesday as investors balanced fresh signals of possible diplomatic outreach in the Middle East with stronger-than-expected labor data. After Tuesday’s sharp sell-off, dip-buyers returned, lifting the Dow Jones Industrial Average about 0.7% in early trading.
The rally was led by tech. The Nasdaq Composite jumped roughly 1.4% at the open, while the S&P 500 gained around 0.9%, as traders reacted to reports that Iran had indirectly approached the US about potential terms to end the conflict. Oil prices eased from recent highs on the news, helping calm inflation fears that had rattled markets earlier in the week.
Market Movers:
- Strategy (MSTR) +10% – Shares surged as crypto-linked stocks rallied alongside a rebound in bitcoin, which climbed roughly 5% to around $71,500. The move followed a recent crypto sell-off tied to Middle East tensions, sparking aggressive dip-buying across high-beta names.
- Moderna (MRNA) +9% – The vaccine maker jumped after announcing a $950 million patent litigation settlement tied to its COVID-19 and RSV portfolio. The agreement removes future royalty uncertainty and clarifies its cash outlook, with management projecting $4.5 billion to $5 billion in year-end cash.
- Wix.com (WIX) +9% – Shares climbed despite mixed quarterly results as bookings rose 15% year over year and forward revenue guidance pointed to mid-teens growth. Investors also welcomed a new $250 million private placement agreement that strengthens liquidity.
- Ross Stores (ROST) +7% – The discount retailer rallied after posting strong holiday results and issuing upbeat comparable sales guidance of 7% to 8% for the current quarter. Management also raised its dividend by 10%, reinforcing confidence in earnings momentum.
- Horizon Technology Finance (HRZN) -22% – Shares tumbled after net investment income and total investment income missed estimates. A dip in net asset value and lower prepayment activity added to investor concerns about portfolio performance.
- GitLab (GTLB) -10% – The software firm fell despite a quarterly earnings beat as forward revenue guidance came in below consensus expectations. Investors focused on a softer full-year outlook that tempered enthusiasm for its growth trajectory.
- Abercrombie & Fitch (ANF) -7% – Shares slid after issuing weaker-than-expected first-quarter guidance, overshadowing record fourth-quarter revenue. Management projected slower near-term sales growth, disappointing traders who had priced in stronger momentum.
Oil Eases, but Inflation Risk Lingers
Crude prices retreated modestly after reports of diplomatic outreach, with Brent hovering near $81 per barrel and West Texas Intermediate around $73. The pullback followed a sharp surge earlier this week as threats to the Strait of Hormuz disrupted shipping routes. Still, energy markets remain a central risk. Sustained higher oil prices could feed into headline inflation, complicating the Federal Reserve’s rate-cut timeline. Treasury yields ticked higher this week as traders pared back expectations for aggressive easing.
Labor Data Boosts Sentiment
Fresh data from ADP showed private employers added 63,000 jobs in February, topping expectations of 50,000. The report offered reassurance that the labor market remains resilient despite geopolitical stress. Attention now turns to Friday’s official jobs report, which could further shape rate-cut expectations. A strong print may reinforce the narrative of economic durability, while a softer number could reignite hopes for policy easing later this year.
Big Tech Back in Control
Megacap stocks once again carried much of the rally, echoing the market leadership pattern seen in 2023. Technology and consumer discretionary sectors rebounded from recent lows, while communication services hovered near record territory. Crypto-related equities also ripped higher as bitcoin rebounded sharply, with traders debating whether the move reflects a broader risk-on shift or simply short covering after recent weakness.
Looking Ahead
Markets remain caught between geopolitical headlines and macroeconomic crosscurrents. Any confirmation of diplomatic progress in the Middle East could extend the rebound, particularly if oil continues to cool. But volatility is unlikely to fade quickly. Investors will watch energy markets, Treasury yields, and Friday’s jobs data closely for clues on whether this week’s bounce marks the start of a sustained recovery — or just another swing in an increasingly headline-driven tape.