US equity markets maintained their upward momentum during Thursday's late trading session, with the Nasdaq Composite rising by 1.2%.
Broad gains in semiconductor stocks coupled with a decline in oil prices provided support for the indices, as traders continued to evaluate the heightened tensions between the US and Iran.
Former President Donald Trump stated that Iran had called seeking a deal after US strikes, though he added it was unclear whether hostilities would resume.
The Dow Jones Industrial Average advanced 117.63 points, or 0.22%, to close at 52,466.02.
The Nasdaq Composite gained 318.36 points, or 1.23%, finishing at 26,189.01, while the S&P 500 increased by 56.81 points, or 0.76%, to settle at 7,539.52.
The VanEck Semiconductor ETF (SMH) climbed 3%, led by a 7% surge in shares of Micron Technology.
SanDisk also posted a significant gain of 7%.
European markets rebounded on Thursday as investors monitored the renewed Middle East tensions, with the pan-European Stoxx 600 index rising 0.7% amid mixed performance across regional markets and sectors.
In Asia, Japan's Nikkei 225 index closed 1.4% higher, and South Korea's KOSPI gained 0.62% in volatile trading.
The US Central Command announced a second consecutive day of new strikes against Iran, described as a response to Iranian attacks on commercial shipping in and around the Strait of Hormuz, which have slowed traffic through the critical waterway.
However, crude oil futures prices moved lower after former President Trump's comments that Iran had called seeking an agreement.
This followed remarks from Trump on Wednesday, where he suggested he might no longer be interested in negotiating a deal with Iran, having previously declared a ceasefire with Tehran "over" following another round of attacks in the Middle East.
Megan Horneman, Chief Investment Officer at Verdence, commented on the highly inflationary and uncertain environment, stating, "It could end tomorrow, or it could escalate into something larger. We don't know. So in that environment, you have to be well-diversified in your global equity allocation."
Horneman believes market volatility will persist, as investors may have become "somewhat numb" to the "mercurial" dynamics of the conflict.
She also noted that current stock price levels may not be factoring in the possibility of at least one Federal Reserve interest rate hike in the second half of 2026.
"This is evolving into a persistent inflation issue for the remainder of the year," she said, adding that it's "not just oil prices."
While sustained investment in artificial intelligence could be disinflationary over the long term, she indicated that, in the near term, "all that investment, strong (economic) growth, and a consumer that continues to spend—that's inflationary."