What Happened?
A number of stocks jumped in the afternoon session after President Trump cooled fears of a transatlantic trade war by calling off scheduled tariffs on European allies.
The rally followed a productive meeting in Davos with NATO Secretary General Mark Rutte, where a "framework of a future deal" regarding Greenland and the Arctic region was established. By explicitly ruling out the use of military force and suspending the 10% tariffs previously set for February 1st, the administration provided the "sigh of relief" the market desperately needed after Tuesday's sharp sell-off. Technology and semiconductor leaders like Nvidia and AMD spearheaded the recovery as investors quickly pivoted back into growth stocks. The "Sell America" trade from the prior session reversed sharply, with the Nasdaq Composite jumping 1.5% and the S&P 500 erasing its 2026 losses. This rebound was further supported by a stabilization in the bond market; as tariff-related inflation fears subsided, the 10-year Treasury yield retreated from its recent highs, creating a more favorable backdrop for equity valuations across the board.
The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks.
Among others, the following stocks were impacted:
- Electronic Components & Manufacturing company Coherent (NYSE: COHR) jumped 5.8%. Is now the time to buy Coherent? Access our full analysis report here, it’s free.
- Satellite Telecommunication Services company Iridium (NASDAQ: IRDM) jumped 2.7%. Is now the time to buy Iridium? Access our full analysis report here, it’s free.
- Terrestrial Telecommunication Services company Array (NYSE: AD) jumped 2.7%. Is now the time to buy Array? Access our full analysis report here, it’s free.
- IT Services & Consulting company EPAM (NYSE: EPAM) jumped 3.8%. Is now the time to buy EPAM? Access our full analysis report here, it’s free.
- Business Process Outsourcing & Consulting company Concentrix (NASDAQ: CNXC) jumped 4.1%. Is now the time to buy Concentrix? Access our full analysis report here, it’s free.
Zooming In On Coherent (COHR)
Coherent’s shares are extremely volatile and have had 48 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 6 days ago when the stock gained 10.8% on the news that the company announced the launch of its Sapphire XT, a new compact and powerful visible laser platform. Based on its proven Optically Pumped Semiconductor (OPS) technology, the new product doubled the performance of prior models while cutting its size by more than 50%. The Sapphire XT was released as a one-box system with an integrated controller and a footprint comparable to a smartphone. The product launch occurred against a backdrop of solid business performance for the company, as its Data Center sales had also grown 23% year-over-year.
Coherent is up 4.1% since the beginning of the year, and at $202.22 per share, has set a new 52-week high. Investors who bought $1,000 worth of Coherent’s shares 5 years ago would now be looking at an investment worth $2,168.
Microsoft, Alphabet, Coca-Cola, Monster Beverage—all began as under-the-radar growth stories riding a massive trend. We’ve identified the next one: a profitable AI semiconductor play Wall Street is still overlooking.Go here for access to our full report, it’s free.
