Victory at all costs
Victory! Tuesday could well be described as a day of triumph. Israel declared victory. Iran declared victory. President Trump proclaimed a tremendous victory. And, of course, investors too had every reason to feel victorious by the end of the day. Still, some doubt remains – was this victory genuine? But then, what is ever truly clear-cut in our world? Either way, the consequences of this so-called victory were plain to see on the stock market.
The day began with confident optimism among market participants and proceeded calmly – without disruptions, corrections or noticeable profit-taking. Only in the final minutes of the main trading session was there a slight decline, likely due to intraday speculators closing out their positions.
By the close, all major U.S. indexes finished firmly in positive territory, with gains ranging from 1.11% for the broad-market S&P 500 to 1.43% for the NASDAQ Composite. Meanwhile, the NASDAQ 100 – the Composite’s close relative – surpassed its previous all-time high set on 19 February this year. And it was not alone: the ITS Shariah Index (ITSS), which tracks Shariah-compliant securities, also hit a new record, closing at 1,283.28 points.
Sector performance echoed this widespread optimism – 9 out of 11 sectors ended the day in the green. The only exception was the oil and gas sector, where average losses exceeded 1% (-1.08%). This was no surprise: crude oil prices continue to fall sharply, with a single-day drop of over 5% yesterday alone.
Technology stocks were the top performers, rising on average by 2%. Again, no surprise – during periods of heightened optimism, tech stocks are traditionally the key drivers of overall market growth. Eight of the ten best-performing stocks in the ITSS index yesterday were from the technology sector. These included not only U.S. companies such as Advanced Micro Devices (AMD), Oracle (ORCL) and Broadcom (AVGO), but also leading Asian and European players like Taiwan Semiconductor Manufacturing (TSMC) and SAP SE (SAP).
The ITS World Index (ITSW), which tracks global companies, also posted solid gains, rising by 0.86%. The momentum there was driven not only by U.S. big tech but also by leading Chinese firms. Asia caught the wave of “Trump victory” euphoria, and local indexes surged. Hong Kong’s Hang Seng Index nearly reached its local highs from three months ago. Chinese tech giants like Alibaba (BABA), Baidu (BIDU), JD.com (JD), NetEase (NTES) and others were key contributors to this rise – both in regional markets and within ITSW.
Clearly, optimism has gripped the markets entirely. Investors are enthusiastically buying stocks across the board – in Europe, Asia and the U.S. As anticipated, several global indexes have reached historical highs, with some even surpassing them. But the question remains: how sustainable is this rally? Could this victory ultimately prove to be Pyrrhic?
At the very least, U.S. Federal Reserve Chair Jerome Powell was far less upbeat than many market participants in his semi-annual testimony to Congress yesterday. He reiterated that the Fed has no intention of rushing into rate cuts and warned of risks tied to potential tariff increases – which, in turn, could spark a new wave of inflation. So yes, we celebrate the current rally and aim to benefit from it – but we do so with a cool head and sound judgement.
Market outlook for 25 June 2025
Wednesday brings a market cooldown after Tuesday’s sharp rally. It was already clear the day before that the hype surrounding the end (or pause?) of the Middle Eastern conflict wouldn’t last. The underlying issues haven’t gone anywhere, and there are still more questions than answers. Investors understand this perfectly well. As a result, today’s market mood is noticeably more subdued than it was yesterday.
The only clear optimism is in Asia – and for a good reason: local markets are catching up with yesterday’s gains on Wall Street. That’s why all regional indexes are in the green, with the sharpest rises on the mainland Chinese and Hong Kong exchanges. The Shanghai Composite added 1.04%, while Hong Kong’s Hang Seng climbed 1.23%.
Europe is much quieter. After Tuesday’s 1.5% surge, today’s indexes are still showing green but hovering near the zero mark. The frontrunner is Italy, where the Milan Stock Exchange index rose by a grand total of 0.2%. In other words, zero means zero. A similar picture can be seen in U.S. futures trading, where deviations from zero do not exceed 0.1%.
This calm suggests that market participants are waiting for Federal Reserve Chair Jerome Powell’s next remarks. Following Tuesday’s appearance in Congress, he continues his solo show today in the Senate. That said, Powell said nothing new yesterday, and the odds of hearing any revelations today are even slimmer. Unless an external shock emerges, trading is likely to remain quiet, with indexes staying close to yesterday’s levels.
After the closing bell, however, the market could be in for a shake-up. Quarterly results are due from Micron Technology (MU) – one of the undisputed leaders in the semiconductor industry. Expectations are high. The company is currently on a strong upward trajectory, posting excellent results and upbeat forecasts that continue to lift its share price. In early April, Micron shares traded at $64 – today, they are approaching $128.
A 100% gain in just three months – undeniably impressive. Many analysts have already revised their target prices for Micron, raising them to $145–150 per share. The upcoming earnings report will show whether this rally is justified and what investors can realistically expect from the stock in the near term.
In any case, analysts anticipate a strong price move following the report – and judging by options market pricing, it could be around 10% from current levels. The only question is which direction the price will take.
That the market needs a breather is clear to all. But what happens next? With major indexes hovering near their all-time highs – the S&P 500 is just 0.7% away – market participants may well try, by any means necessary, to push the index over the line. If that happens, it will likely be within days. So, for now, all investors can do is wait – and hope for new highs.