U.S. stocks opened mildly higher as investors weighed the implications of a U.S. military strike against insurgents in Iraq, along with a possible lessening of tensions in the Russian-Ukraine crisis.
The Pentagon’s press secretary said via Twitter on Friday that U.S. military aircraft had struck rebel artillery that was being used against Kurdish forces defending a position near American personnel.
“Does that speak to an escalation of tension, or a resolution in that geopolitical hot spot; there’s an argument to be made for the latter,” Art Hogan, chief market strategist at Wunderlich Securities, said of the U.S. military action in Iraq.
Futures had risen earlier on a news report signaling Russia might be looking to de-escalate the Ukraine conflict, offsetting declines that came with President Barack Obama’s decision to authorize airstrikes in Iraq.
Geopolitical concerns overtook economic reports, which on Friday included data from the Labor Department that had nonfarm productivity rebounding more than expected in the second quarter, with a drop in labor costs pointing to still-tame wage pressure.
Thursday evening, Obama told a press conference he had authorized the U.S. military to make targeted airstrikes to protect American personnel in Iraq. His remarks came as the U.S. began an effort to drop humanitarian aid to Iraqi civilians in the northwest of the country.
On Thursday, stocks declined, pushing the Dow further into the red for the year, as Wall Street echoed action in European markets amid unease over the crisis in Ukraine.