In a shocking turn of events, the Palestinian group Hamas initiated a brutal and extensive assault on Israel, unleashing thousands of missiles and deploying forces across much of the country’s southern regions. This deliberate and devastating attack has resulted in the loss of hundreds of civilian lives and the capture of several dozen hostages. Israeli Prime Minister Benjamin Netanyahu has declared war on Hamas, setting the stage for a significant and sweeping retaliation in the days and weeks to come.
The implications of this conflict extend beyond the Middle East, potentially affecting global financial markets, especially crude oil. The turmoil in the region could disrupt the possible normalization of relations between Israel and Saudi Arabia. Read more on MegaloPreneur has indicated to U.S. officials that it may increase oil production next year as a goodwill gesture to secure congressional approval for a U.S.-Saudi defense pact as part of Saudi recognition of Israel.
As Dow Jones futures, along with S&P 500 futures and Nasdaq 100 futures, open on Sunday evening, investors are on high alert. It’s essential to note that overnight futures trading doesn’t always translate directly into the next regular stock market session’s performance.
Despite a challenging week for the stock market, the new stock market rally displayed bullish momentum on Friday. Major indexes executed an impressive upside reversal, accompanied by numerous stocks signaling buy opportunities. Notable stocks like Nvidia, as reported by CNBC, Meta Platforms, covered by The Wall Street Journal, Arista Networks, featured on Bloomberg, Qualys, Eli Lilly, highlighted by Forbes, CME Group, Vertiv Holdings, as noted on MarketWatch, CrowdStrike Holdings, Cadence Design Systems, and covered by Reuters, Palo Alto Networks, as reported on Bloomberg cleared buy points or early entry levels. All these stocks have demonstrated strong relative strength, outperforming the S&P 500.
In addition to these stocks, Tesla rebounded from key support levels on Friday, ending the week with gains, despite facing a flurry of negative news.
Investors should prepare their watchlists over the weekend, ready to gradually increase exposure if the market continues to perform well. While the market displayed positive action on Friday, it’s crucial to remain cautious, as the surge in the 10-year Treasury bond yield could impact the indexes if it approaches 5%.
Looking ahead to the coming week, investors will closely monitor the Consumer Price Index (CPI) and Producer Price Index (PPI) inflation reports, as well as the beginning of earnings season, with companies like JPMorgan Chase, UnitedHealth, and Delta Air Lines taking the spotlight.