Best stocks to buy now as report of Iran outreach shifts market outlook

Reports that Iran’s new leadership quietly reached out to Washington about possible talks have sparked cautious optimism in markets, shifting sentiment from outright panic to a more balanced view of war risks.

Dow Jones futures edged up a fraction against fair value, while S&P 500 futures climbed 0.15% and Nasdaq 100 futures rose 0.25%.

The modest bounce came after solid overnight losses, driven by a New York Times report revealing that Iran’s Ministry of Intelligence made indirect contact with the CIA just one day after the US–Israeli strikes began, floating an offer to discuss terms.

Washington hasn’t engaged seriously so far, but traders latched onto the news as a potential glimmer of hope for near-term negotiations that could wind down the fighting.

For investors, that mix of tentative de‑escalation and ongoing strikes is reshaping where to put money to work.

The war premium in oil, defence and gold remains in place, but some strategists now see scope to shift from pure “haven‑first” positioning toward a barbell of cyclical and defensive plays in case negotiations cap the conflict.

Wall Street’s initial reaction to the strikes was to buy energy, defence and Treasuries while trimming broad equities, but research is starting to differentiate between short‑term tactical winners and names that could hold up if talks gain traction.

Energy: Still core

Oil remains at the centre of any US–Iran war strategy. The Strait of Hormuz handles roughly a quarter of global seaborne crude, and shipments have already been disrupted as tankers reroute or pause.

Analysts say Brent could test higher levels if flows remain constrained, but they also flag that a credible diplomatic track could see the risk premium compress quickly.

Large, diversified producers and high‑yield names continue to feature on Iran‑conflict stock lists.

Experts suggest Chevron and Exxon Mobil, arguing that their free cash flow and integrated models make them resilient across scenarios, even if prices retreat from war‑driven highs.

UBS’s chief investment office similarly keeps energy in its preferred sectors as long as the conflict risks keep oil structurally tighter than pre‑war expectations.

With talk of negotiations emerging, the emphasis within energy shifts slightly from pure price torque toward balance‑sheet strength, dividend cover and assets that remain valuable even if crude stabilises.

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Defence: From event pop to duration trade

Defence contractors were among the earliest beneficiaries when the strikes began, with the iShares US Aerospace & Defense ETF up strongly on expectations of higher missile, air‑defense and surveillance demand.

Names such as RTX and other primes with Patriot and radar exposure are repeatedly cited as direct beneficiaries of Iranian missile and drone threats.

At the same time, at least one tactical note on the Iran strikes warns that defence stocks are highly sensitive to political signalling about how long the operation will last.

If US and Israeli leaders frame the campaign as limited and signal openness to talks, the fear premium in these shares could unwind quickly; if they telegraph broader, longer‑term aims, the rally could persist.

With Iran now reaching out to negotiate even as fighting continues, that risk–reward looks more balanced.

Analysts suggest focusing on contractors with deep backlogs and exposure to longer‑cycle programs rather than simply chasing short‑term pops linked to headlines.

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Gold and havens: Insurance, not an all‑in bet

Gold’s run above previous records and the drop in US Treasury yields reflect how aggressively investors initially sought shelter.

Analysts note that the US–Iran confrontation has been a fresh catalyst for bullion, which had already been in a structural uptrend, and that further escalation around Hormuz could extend the move.

But some strategists now warn that if talks between Washington and Tehran gain traction and the conflict proves shorter and more contained than feared, “selling oil and gold into strength” could become attractive, especially given how quickly both moved on the initial shock.

That view argues for treating gold, the dollar and high‑grade bonds as portfolio insurance rather than primary return engines at this stage, particularly as US fundamentals and Fed policy still anchor medium‑term rates.

Quality equities and income: Positioning for both paths

Across houses, the common thread is to avoid binary bets on either a full peace or uncontrolled escalation.

Reuters’ survey of strategists highlights energy, defence and gold as near‑term winners, but also points to quality, cash‑rich companies with pricing power as relative safe harbours if higher oil briefly rekindles inflation concerns.

UBS similarly stresses diversification, recommending investors pair sector overweights in energy and selected industrials with defensive income plays and some exposure to havens.

If negotiations falter and the conflict widens, those wartime trades are likely to remain in favour.

If Iran–US talks advance and fighting ebbs faster than expected, positions tilted toward balance‑sheet strength and structural growth rather than pure fear trades should be better placed to hold their value.

With both paths still open, the best “stocks to buy right now” are less about one perfect theme and more about building a mix that can absorb whichever version of this war ultimately plays out.