Dow Jones Recovers 400 Points from Lows, Downside Risks Remain

[Redator]

• Dow Jones recovers 400 points from daily low.
• Middle East tensions impacting market sentiment.
• Defense stocks rise, airlines stocks fall.
• Markets could face gaps over the weekend.

Read More: Oil Surges 10%, Gold Above $3400/oz as Israel Strikes Iran

The Dow Jones Index has recovered around 400 points from its daily low as markets shrug of initial fears of a wider Middle East conflict. There are a lot of conflicting reports circulating online about the attack on Iran overnight as Israel appears to have easy access to Iranian airspace. These developments as well as bullish comments from US President Trump about Israels rights to defend itself and that the US would provide aid in the case of an Iranian response appear to have led to a slight improvement in sentiment.

Markets appear to be of the belief that a significant Iranian response may not be forthcoming given the scope of the Israeli offensive which has led to the death of many Commanders of the IRGC as well damage to ballistic missile launchers and the Iranian air defense system.

The recent recovery is widespread with the Nasdaq leading the way. The Nasdaq 100 is now trading down around 0.3% on the day also up nearly 400 points from its daily low.

Airline stocks fell as rising fuel costs could spike if supply issues arise. Delta Air Lines dropped 3.7%, United Airlines fell 4.4%, and American Airlines slid 4.7%.

Meanwhile, defense stocks rose, with Lockheed Martin, RTX Corporation, and Northrop Grumman gaining between 2.2% and 3.2%.

The recovery in the Dow has been held back somewhat by card issuers Visa and American Express which have come under pressure after a report by the WSJ that Walmart WMT.N, Amazon AMZN.O and Expedia Group EXPE.O are among companies exploring their own stablecoins.

Supporters argue these systems could remove the need for middlemen like Visa and Mastercard, which collect billions in fees annually. Visa did not respond to a request for comment when asked.

Source: TradingView

President Trump Tells Axios "Israel's attack could help me make a deal with Iran"

US President Donald Trump has been vocal over the last few hours on Israels attack on Iran. This comes after the White House issued a statement by Secretary of State Marco Rubio last night denying US involvement.

However, over the course off the day various reports have comes out quoting Israeli officials stating that the US knew about the attacks, while the initial Iranian response which consisted of mainly drones was neutralized with the help of the US and Gulf allies who shot down drones over their territory.

Source: X.Com

Navigating Markets Ahead of the Weekend and Beyond

As things stand, the situation remains fluid with Iran at the moment seemingly against the ropes. There are huge questions about whether Iran has been incapacitated by the Israeli strikes which continue. The most recent reports of the IDF bombing the Fordow nuclear plant and other parts of Tehran with no real Iranian resistance thus far.

There has also been growing murmurs that the strikes may lead to a potential regime change, something Israel and the US have been touting for years.

If Iran are unable to retaliate significantly market risk could continue to subside, however if there are signs that a prolonged battle is just getting started, wild swings and gaps over the weekend could materialize.

Technical Analysis - Dow Jones Index

From a technical standpoint, the Dow Index is printing lower highs and lower lows since the high on June 11, around 43132.

Markets were already cautious ahead of last nights developments in the Middle East which sent sentiment tumbling.

The recovery could be down to a host of factors which include the idea that the worst may be behind markets in regard to the strikes on Iran as well as potential profit taking before the weekend.

Either way, the probability of gaps when the market opens on Sunday remains high and could lead to some volatile price action ahead of the market close today.

Immediate support rests at 42336, 42160 and 42000.

Immediate resistance rests at 42512, 42653 and 42764.

Dow Jones H4 Chart, June 13, 2025

Source: TradingView (click to enlarge)

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