Nasdaq surges as war fears unwinds

<p>The rout in the Nasdaq late last week is unwinding as the market gets a (somewhat) clearer view on the Middle East.</p><p>Israel started its ground offensive late on Friday and it didn't trigger the opening of a second front, at least not yet. It also appears that the US isn't backing a broader fight that could spill over to Iran.</p><p>Of course, that's all extremely fluid and some of the comments from Turkey are worrisome but for now, the market is breathing something of a sigh of relief.</p><p>Mixed in with that are likely some month-end flows and dip buying on softer eurozone inflation.</p><p>The Nasdaq is leading the way with a 1.5% rally today on strength from Meta (+3.4%) as it tries to roll out ad-free subscriptions. Amazon is also continuing its rebound from Friday with a 3.4% rally and Microsoft is up 2.7% as the Magnificent 7 re-assert themselves. </p><p>Be careful with this rally as oversold bounces can be strong but they can also fade quickly. A sustained bounce will need some help from the Fed, or at least the bond market.</p>

This article was written by Adam Button at www.forexlive.com.