Global stocks have had a rocky beginning to the year. Initial panic over the disruptive effects of artificial intelligence (AI) on traditional business models sparked selloffs across several sectors. Soon after, the outbreak of war in the Middle East added another layer of uncertainty to financial markets.
Despite these developments, major indexes largely held steady until recently. State Street SPDR S&P 500 ETF Trust SPY lost about 0.4% so far this year, State Street SPDR Dow Jones Industrial Average ETF Trust DIA is up about 0.4% and the Nasdaq-100-based ETF Invesco QQQ Trust, Series QQQ has lost about 1.9% in the year-to-date frame.
Lucrative Buying Opportunity Despite High Valuation?
Strategists at Goldman Sachs noted that equity returns have broadened across regions and investment styles. However, this wider participation has pushed valuations above historical norms. According to the bank’s team, all global sectors are now trading at premiums relative to their 20-year averages, per Bloomberg, as quoted on Yahoo Finance.
In a separate appearance in Australia, Goldman Chairman David Solomon remarked that he has been surprised by the relatively “benign” response of financial markets to the Middle East conflict. He cautioned, however, that it could take several weeks to gain clearer insight into how the situation will unfold, the same Bloomberg article noted.
Per analysts, global conflicts historically haven’t disrupted markets for very long, per CNN, as quoted on Yahoo Finance. While headlines about war can be scary, stocks historically have been able to shrug off those fears. Still, DIA lost about 1.7% over the past five days, SPY was off about 1% and QQQ lost about 0.6%.
ETFs Braving Iran Conflicts
Against this backdrop, below we highlight a few exchange-traded funds (ETFs) that have gained over the past week and month. These ETFs appear to be steady and conflict-proof at the current level.
WisdomTree Cloud Computing Fund WCLD – Up 5.6% Past Week, Up 1.1% Past Month
Cloud computing stocks are in sweet spots due to surging demand for AI infrastructure and broader digital transformation trends. Major players like Microsoft Azure, Amazon AWS, and Google Cloud are seeing accelerated growth. Generative AI is driving massive cloud spending.
State Street SPDR S&P Telecom ETF XTL – Up 5.2% Past Week, Up 16.5% Past Month
Telecom stocks are showing resilience amid the Iran war due to their defensive qualities and underlying growth drivers. Essential services like connectivity remain in demand irrespective of geopolitical tensions. Accelerated 5G rollouts and rising data consumption from AI applications are boosting revenues.
Invesco S&P 500 Equal Weight Communication Services ETF RSPC – Up 3.8% Past Week, Up 3.7% Past Month
Communication Services stocks are benefiting due to robust AI-driven growth in tech giants. The sector combines defensive telecom stability with high-growth internet content.
iShares U.S. Healthcare Providers ETF IHF – Up 0.7% Past Week, Up 2.4% Past Month
Healthcare provider stocks are rising due to attractive valuations, improving fundamentals, and defensive appeal amid market volatility. These are often viewed as defensive plays.
State Street SPDR S&P Oil & Gas Exploration & Production ETF XOP – Up 8.4% Past Week, Up 10.5% Past Month
Energy stocks are rising in 2026 due to a combination of geopolitical tensions like Iran conflicts, cold weather boosting demand, elevated oil and gas prices, and strong investor rotation into defensive, and tech sector pullbacks. With OPEC output boost seems to be minimal in nature, oil and gas prices are likely to be steady in the coming days.
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Invesco QQQ (QQQ): ETF Research Reports
State Street SPDR S&P 500 ETF Trust (SPY): ETF Research Reports
State Street SPDR Dow Jones Industrial Average ETF Trust (DIA): ETF Research Reports
State Street SPDR S&P Oil & Gas Exploration & Production ETF (XOP): ETF Research Reports
iShares U.S. Healthcare Providers ETF (IHF): ETF Research Reports
State Street SPDR S&P Telecom ETF (XTL): ETF Research Reports
WisdomTree Cloud Computing ETF (WCLD): ETF Research Reports
Invesco S&P 500 Equal Weight Communication Services ETF (RSPC): ETF Research Reports
This article originally published on Zacks Investment Research (zacks.com).
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