The Nasdaq Composite has endured a period of significant volatility, experiencing sharp rebounds and declines as investor sentiment reacted to both a deep sell-off in the technology sector and escalating geopolitical events in the Middle East.

Tech Sector's Rollercoaster Ride

Early in February, the tech-heavy Nasdaq faced intense selling pressure, leading to several days of substantial losses across the sector. However, the index staged a powerful comeback on Friday, February 5, advancing 2.18% to close at 23,031.21. This surge helped the S&P 500 climb back into positive territory for 2026, though the Nasdaq still ended that week down 1.8%.

Key technology and semiconductor stocks led the recovery. Nvidia, a major player in the chip industry, jumped nearly 8%, while Broadcom saw its shares rise 7%. Both companies had faced significant declines earlier in the week. Other tech giants like Oracle and Palantir Technologies also bounced back, each gaining 4% as investors began to reconsider these names at potentially cheaper valuations.

Yet, not all tech stocks participated in the rebound. Some software companies, notably ServiceNow, remained weak. Analysts attributed this to ongoing fears about artificial intelligence disrupting the software sector. Gabriel Shahin, founder of Falcon Wealth Planning, described the current environment as a "gold rush" for AI, with major investments from companies like Google, Nvidia, Meta, and Amazon. But he also noted that the rapid movement of money, or "carousel," sometimes scares people.

Shahin believes the market is in the midst of a "great recalibration." He predicts investors will shift further away from growth stocks and into value plays in the coming months, favoring large-cap value names. This trend was evident on February 5, as industrials and financials saw increased buying, with Caterpillar gaining 7% and Goldman Sachs rising 4%, supporting the Dow's strong performance.

Geopolitical Tensions Fuel Market Swings

Just over a month later, geopolitical events took center stage, driving another dramatic reversal for the Nasdaq and broader markets. On Monday, March 8, the Nasdaq Composite jumped 1.38% to settle at 22,695.95, marking an impressive turnaround from earlier session lows where the index had fallen as much as 1.5%.

This recovery followed comments from President Donald Trump, who told a CBS News reporter that the war against Iran was "very complete, pretty much." Trump added that the U.S. was "very far" ahead of his initial four-to-five-week timeframe for the conflict, asserting that Iran had "no navy, no communications, they've got no Air Force." He also mentioned that ships were moving through the crucial Strait of Hormuz passageway and indicated he was "thinking about taking it over."

These developments had an immediate impact on oil prices. West Texas Intermediate crude, which had surged above $100 per barrel overnight and hit more than $119 for the first time since 2022, quickly reversed course. It fell to as low as $81 a barrel following Trump's statements. International benchmark Brent crude also pulled back to nearly $84 a barrel.

Earlier in the day, oil prices had jumped after major Middle East producers, including Kuwait and Iraq, announced output cuts due to the closure of the Strait of Hormuz. Iraq reportedly saw its production fall 70%. Many on Wall Street viewed the $100 oil level as a "breaking point" for the economy unless the conflict was resolved quickly and prices retreated.

Energy ministers from the Group of Seven nations — Canada, France, Germany, Italy, Japan, the United Kingdom, and the U.S. — planned to meet virtually on Tuesday morning to discuss potentially releasing oil reserves. Their finance ministers had met on Monday but did not make a decision. John Luke Tyner, portfolio manager at Aptus Capital Advisors, downplayed the longer-term impact of the oil price spike, saying, "I don't think this little blip was bad enough or long enough to really upset the apple cart as far as growth and earnings go."

Broader Market Context and Divergent Trends

While the Nasdaq experienced these significant swings, the broader market indices also reacted strongly. On March 8, the S&P 500 rose 0.83% to 6,795.99, and the Dow Jones Industrial Average added 239.25 points, or 0.5%, to 47,740.80. The Dow had been coming off its biggest weekly slide in nearly a year and was down nearly 900 points at its session low on March 8 before Trump's comments spurred a recovery.

However, the overall impact of the Iran war on equities was negative. As of Friday, March 14, the tech-heavy Nasdaq was off more than 2% since the conflict began on February 28. The S&P 500 and gold were also down more than 3% during the same period. This suggests that despite individual days of recovery, the overarching geopolitical uncertainty weighed heavily on traditional markets.

Interestingly, some alternative assets performed differently. Bitcoin, the popular cryptocurrency, saw a notable comeback. Since the start of the Iran war on February 28, bitcoin gained roughly 8%, with most of those gains occurring over a 24-hour period in the second week of March. Simeon Hyman, global investment strategist at ProShares, highlighted this trend on CNBC's "ETF Edge," stating that "the diversification story really holds in in this current environment" as equities were down while bitcoin was up.

ProShares, a firm active in the cryptocurrency space with over a dozen crypto ETFs, recently launched the ProShares CoinDesk 20 Crypto ETF (KRYP). That fund was up nearly 5% since the Iran war began, even though it was still off about 7% since its early February debut. Despite its recent strength, bitcoin remained more than 40% below its record high of $126,198, reached in October of the previous year.

The broader market was also helped on March 8 by a rise in semiconductor stocks, with Broadcom advancing more than 4%, while Micron Technology and Advanced Micro Devices increased 5% each, and Nvidia climbed more than 2%.