Buy-on-dip appetite returns as oil jitters ease…Nasdaq jumps 1.3% [New York market briefing]

U.S. government’s all-out effort helps calm oil-market jitters

Stocks steady on improved U.S. services-sector data

Wall Street’s three major stock indexes ended higher.

As U.S. government steps to stabilize oil prices fueled signs that the crude market was calming, risk appetite appeared to return to equities. A sharp improvement in U.S. services-sector conditions, extending the expansion streak to 20 straight months, also supported bargain-hunting demand.

On the 4th (local time), at the New York Stock Exchange (NYSE), the Dow Jones Industrial Average rose 238.14 points (0.49%) from the previous session to close at 48,739.41. The Standard & Poor’s (S&P) 500 gained 52.87 points (0.78%) to 6,869.50, and the Nasdaq Composite jumped 290.79 points (1.29%) to finish at 22,807.48.

With a full-scale war between the United States and Iran continuing, the U.S. government again moved aggressively to quell oil-price anxiety. U.S. Treasury Secretary Scott Bessent said, “I would encourage you to see where we go after this,” adding that “the oil market is very well supplied and there are hundreds of millions of barrels offshore away from the Gulf.”

He said the United States would provide maritime insurance and, if necessary, the U.S. Navy would ensure safe passage for tankers transiting the strait—reiterating measures President Donald Trump had made public the previous day.

The White House also said it had destroyed more than 20 Iranian ships, stressing that “Iran will no longer be able to control the Strait of Hormuz or restrict energy flows.”

On the back of this, international oil prices fell more than 1% early in the session, showing some easing of anxiety. At the very least, “panic buying” appeared to be subsiding.

Stocks responded positively to news that the U.S. services sector had improved. The very fact that markets reacted to services-sector conditions despite the Iran war was read as a sign that the pricing-in of geopolitical risk had largely run its course.

The Institute for Supply Management (ISM) said its February services Purchasing Managers’ Index (PMI) came in at 56.1.

That was up 2.3 points from January’s 53.8 and above the market consensus of 53.5. The 56.1 reading is the highest since 56.5 in July 2022 and marks 20 consecutive months of expansion. On the release, the S&P 500 briefly jumped more than 10 points.

Custom AI chipmaker Broadcom reported fourth-quarter results after the close, with both revenue and earnings per share (EPS) beating market expectations. Its shares rose in regular trading by around 1%.

Among mega-cap tech companies with market capitalizations above $1 trillion, Amazon climbed 3.88% and Tesla rose 3.44%. Meta and Nvidia also posted gains of around 1%.

Microsoft (MS) also advanced on favorable reviews from Wall Street investment banks, reclaiming the $3 trillion market-cap threshold.

The Philadelphia Semiconductor Index, which had plunged more than 4% the previous day, rebounded about 2%. Micron Technology, AMD and Intel each rose more than 5%.

Shin Min-kyung, Hankyung.com reporter radio@hankyung.com