Wall Street Shakes Off Iran Tensions, Nabs New Highs

The Dow, S&P 500, and Nasdaq are all heading toward weekly wins

by Patrick Martin

Published on Jan 10, 2020 at 12:25 PM

If the next decade is anything like the first full week of 2020, Wall Street is in for a wild ride. U.S.-Iran tensions were at the forefront to start, as investors unpacked the headlines surrounding the killing of Iranian military commander Qassem SoleimaniGold prices exploded in response, as investors sought the safe-haven asset amid geopolitical volatility, while energy stocks also saw a volatile run. The Middle East tensions eventually wore off after comments from President Donald Trump, and all three benchmarks nabbed record highs on Thursday. And despite a lackluster jobs report on Friday, the Dow, S&P 500, and Nasdaq are all poised to kick off the decade with weekly wins. 

Tech Sector, Chip Stocks Make Noise

In the broader tech sphere, Salesforce.com (CRM) gained after picking up a new "top pick" designation. And if there's one stock that stands to benefit from escalating tensions in the Middle East, it's cybersecurity firm FireEye (FEYE). 

Turning specifically to the semiconductor sector, the usual suspects were at it again. Call traders blitzed Advanced Micro Devices (AMD), while Micron Technology (MU) flashed a bullish signal going forward. Never one to be left out, Nvidia (NVDA) picked up some late-week gains after being added to Citigroup's "catalyst watch list."

Coca-Cola Upgraded; Boeing in the News Again

A big upgrade from Credit Suisse put Coca-Cola (KO) within a chip-shot from record highs. The fatal 737-800 airliner crash -- which Iran shot down by mistake -- weighed heavily on Boeing (BA) shares. Meanwhile, Walgreens Boots Alliance (WBA) was the first Dow name to step into the earnings confessional this season, and options bulls targeted the drug store name heavily before the event.

Holiday Sales Numbers Weigh on Retailers

It was a wild week for several retail stocks. Nordstrom (JWN) was upgraded and flashed a bullish signal to boot. Pier 1 (PIR) wasn't as lucky, as store closures and job cuts weighed on the stock. Put traders piled on Bed Bath & Beyond (BBBY) after an earnings-induced sell-off, but a holiday sales disappointment from L Brands (LB) wasn't enough to send the stock lower. Unfortunately, the same cannot be said for Urban Outfitters (URBN), which gapped lower on Friday after its own holiday sales tanked. 

Tesla Continues to Race Higher; BYND Cozies Up With MCD

Tesla (TSLA) continued its torrid run of record highs after an encouraging update to its electric SUV. GrubHub (GRUB) denied rumors it was exploring strategic options, sending the stock sharply lower. McDonald's (MCD) and Beyond Meat (BYND) extended their partnership in Canada, sending the latter soaring. 

Banks Ready to Kick Off Earnings Season

Next week is when earnings season really starts to heat up, with big bank names the first up to bat. And 2020 is still young, so here's what 2019's outperformance could mean for the upcoming year. And as Wall Street's "fear gauge" continues to languish, traders should keep their eyes on this VIX pattern.


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