By Omkar Jadhav | June 14, 2025 |
Middle East Crisis Rattles Investors Worldwide
Markets around the world were thrown into turmoil on Friday after a fresh wave of violence erupted in the Middle East. Israel reportedly launched strikes on Iranian nuclear facilities, and Iran responded quickly with its own attacks. The news sent shockwaves through global markets, dragging down major indexes in the United States.
The Dow Jones Industrial Average plunged by more than one percent, breaking through both its 21-day and 200-day moving averages. The S and P 500 and Nasdaq also ended the week in the red, though they managed to stay near record highs for now. Investors are bracing for what comes next as futures for the Dow Jones, S and P 500, and Nasdaq 100 are set to reopen Sunday evening.
With war looming and tensions escalating in the Middle East, investors are being forced to reassess their strategies. The once steady momentum in the stock market has suddenly turned shaky, and many are wondering whether this is just a short-term pullback or the start of something much bigger.
Nvidia and Broadcom Soar, but Are They Still Buyable
While the broader market stumbled, artificial intelligence hardware stocks continued to dominate headlines. Nvidia and Broadcom, two giants in the AI chip industry, both hit record highs last week. Taiwan Semiconductor also joined them in breaking through key resistance points.
Nvidia remains within a buy zone, but some analysts caution that it might be getting overbought. Broadcom, which is featured on several top investment lists, including IBD Leaderboard and Big Cap 20, has also seen an impressive run. These stocks have delivered massive gains since early this year, especially after bouncing back from the Deepseek sell-off in January.
However, chasing stocks at their peak can be risky. For many investors, it might be smarter to look for the next round of AI winners rather than jumping in too late.
The Next Wave of AI Leaders: Underrated Stocks to Watch
If you missed the boat on Nvidia and Broadcom, do not worry. Several other AI-related stocks are starting to show signs of life and may offer better entry points.
Micron Technology is leading this group. The stock recently blasted past a key resistance point near 99 dollars and is now trading above 112. If it holds steady here, investors could be looking at a new buying opportunity. Keep an eye on Micron’s earnings report later this month.
Advanced Micro Devices, or AMD, has been struggling to push past its 200-day line, but it has found support at the 21-day average. A clear move above the 200-day level could trigger new interest among traders.
Arista Networks is another stock worth watching. It has been bouncing around its 21-day line and is just shy of breaking the 100 dollar level. That would push it past its 200-day average and put it back on the radar of institutional investors.
Astera Labs and Arm Holdings are two of the newer AI chip names that have been showing resilience. Both are holding above their 200-day lines and finding support at shorter-term averages. These companies are still in the early stages of growth, which makes them risky but potentially rewarding.
Super Micro Computer, a big name in AI server manufacturing, has pulled back after a massive run but is showing signs of stabilizing. Vertiv Holdings, which builds cooling systems and infrastructure for AI data centers, is also gaining attention. With the growing need for AI support systems, Vertiv could quietly become a key player.
Oil Prices Surge as Conflict Escalates
One of the biggest market movers this past week was oil. With fears growing that war in the Middle East could disrupt energy supplies, crude oil prices soared by more than 13 percent, ending the week at nearly 73 dollars per barrel. That is the highest closing level in four months.
On Friday alone, oil jumped over 7 percent before retreating slightly. The drop came after reports indicated that Israeli forces had avoided targeting Iranian oil production facilities. Still, the risk of supply disruption remains high, and traders are watching the situation closely.
The energy sector responded quickly. The Energy Select SPDR ETF rose more than 5 percent for the week. Defense companies such as Elbit Systems and energy producers like Range Resources also posted strong gains.
Oddly enough, U S Treasury bonds did not get the usual safe-haven bump. The 10-year yield dropped slightly over the week, even after jumping on Friday. That suggests investors are uncertain about how to hedge their risk in this environment.
Financials and Small Caps Suffer Losses
While some sectors benefited from the geopolitical drama, others were hit hard. Financial stocks, including major credit card companies, took a beating. The Financial Select SPDR ETF fell more than 2 percent for the week.
Small-cap stocks also struggled. The Russell 2000 index dropped 1.5 percent and slipped below its 200-day line. That is a troubling sign for market breadth, as smaller companies often lead the way in a healthy rally.
Meanwhile, breakouts in individual stocks remained difficult. Even before Friday’s drop, many breakout attempts had failed or pulled back quickly. Some stocks are still in buy zones or setting up for potential moves, but it is a challenging environment.
All Eyes on the Fed Meeting This Week
The next big event for markets will be the Federal Reserve’s two-day meeting, which concludes Wednesday. The central bank is not expected to cut interest rates at this meeting, but traders will be paying close attention to the Fed’s updated economic projections and any comments from Chairman Jerome Powell.
With inflation data cooling and geopolitical uncertainty rising, the Fed might be more cautious. However, trade policies and the potential return of tariffs under a second Trump administration could complicate things further.
Investors are hoping for clarity, but they may get more confusion instead.
ETFs Show Mixed Signals
ETF performance last week showed just how uneven the market has become. Here is a quick rundown:
VanEck Vectors Semiconductor ETF gained nearly 2 percent, thanks to strong showings by Nvidia, Broadcom, and others
ARK Innovation ETF, known for its high-risk tech bets, surprised everyone with an 18 percent weekly gain
iShares Tech-Software ETF managed a modest rise of 0.25 percent
Innovator IBD 50 ETF fell over 2 percent, reflecting weakness in leading growth names
The Health Care Select Sector ETF rose slightly, while the Industrial Select ETF lost ground
Overall, investors are becoming more selective and defensive, looking for strength in specific sectors rather than betting on the entire market.
What Should Investors Do Now
This is one of those moments where staying calm matters more than trying to predict every move. Yes, the Israel-Iran situation could get worse. Yes, the Fed could say something that spooks the market. And yes, stocks like Nvidia and Broadcom might cool off after big runs.
But the long-term themes remain intact. Artificial intelligence is not just a buzzword. It is becoming a core part of everything from defense to finance to healthcare.
That means there will be more winners in this space. They might not be the obvious choices today, but smart investors will be watching closely for signs of strength, breakouts, and leadership.
Energy stocks, for the first time in a while, also deserve serious consideration. As long as geopolitical risk remains high, oil and defense stocks could outperform.
Conclusion: Uncertainty Brings Opportunity
Markets hate uncertainty, and right now, there is plenty of it. From airstrikes in the Middle East to interest rate policy back home, there are more questions than answers. But times like these often create the best opportunities.
The key is to stay informed, stay disciplined, and stay patient. Watch for technical signals, monitor volume, and pay attention to how stocks behave in moments of stress. The next Nvidia might already be on your watchlist.
The world is changing quickly. If you keep your eyes open, you might just catch the next wave before it breaks.
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