Are Tech ETFs New Safe Haven Amid Iran War?

Global markets remained under pressure last week as escalating U.S.–Israel strikes on Iran pushed oil prices to their highest levels since 2024 (as quoted on Yahoo Finance), forcing investors to reassess the risks of a prolonged regional conflict.

Energy Secretary Chris Wright said oil and gas prices will start to fall when the United States begins to hit Iran’s ability to attack tanker traffic through the Strait of Hormuz, as quoted on CNBC. Note that United States Oil Fund LP USO gained 24.1% last week while United States Brent Oil Fund LP BNO advanced about 17%.

No wonder, the rising geopolitical tension has heightened volatility across global markets, leading investors to look for safe havens even in equities.

Big Tech Seen as Safe Abode: AI Story in Fine Fettle

The tech-heavy Nasdaq-100-based ETFInvesco QQQ Trust, Series 1 QQQ rose 0.2% last week, while the S&P 500-based fund State Street SPDR S&P 500 ETF Trust SPY lost 0.9%. State Street Technology Select Sector SPDR ETF XLK too managed to stay afloat amid last week’s war-led market volatility.The XLK ETF added 0.4% last week.

During periods of turbulence, some Wall Street strategists suggest that certain technology giants can serve as relative safe havens. According to Rob Haworth, senior investment strategist at U.S. Bank Wealth Management, the artificial intelligence trade continues to benefit from a strong structural tailwind. Hyperscalers are expected to boost investment by roughly 30% in 2026 alone, as quoted on Yahoo Finance.

After all, the AI-driven growth story remains durable, at least for now.  In short, large-cap tech stocks are high-growth defensive plays, thanks to the huge and steady demand for AI and digital transformation.

Most of Big Tech: Defensive Plays?

Among the key defensive pillars are Microsoft looks to be a good bet. Even in an economic slowdown, businesses will remain committed to enterprise platforms such as Windows and Azure. Note that Microsoft shares gained 4.3% last week. The parent company of Google, Alphabet Inc., is also viewed as a resilient option due to its diversified and stable business model.

Some strategists on Wall Street are more optimistic about Amazon, pointing to significant margin potential in both its retail business and cloud segment, Amazon Web Services, per the above-mentioned Yahoo Finance article.

Cybersecurity and Defense Gain Strategic Importance

As the geopolitical issues take the upper hand – with markets reacting to the escalating U.S.–Israel strikes on Iran – cybersecurity and defense technologies are increasingly viewed as mission-critical infrastructure.

Companies such as Palantir Technologies, CrowdStrike, and Palo Alto Networks are emerging as key beneficiaries of an “aggressive defensive strategy,” according to Luria, as quoted on Yahoo Finance. These firms provide advanced digital security capabilities needed to counter state-sponsored cyber threats (read: Cyberwarfare Threat Rises: Time to Boost Cybersecurity ETF Exposure?).

According to cybersecurity experts, as quoted on Reuters, a series of cyber-enabled operations reportedly unfolded during the latest Iran war. Additionally, according to CNBC, cybersecurity experts are raising concerns about possible cyberattacks from Iran targeting U.S. businesses and critical infrastructure. 

Favorable Interest Rate Backdrop

The U.S. GDP grew 1.4% in Q4 of 2025, down from economists’ forecast of 3%, as quoted on Guardian. Hence, the Fed is also less likely to hike rates in the short term as the U.S. economy and its job market are showing signs of weakness. Note that a low-rate environment is good for tech ETF investing.

Tech ETFs in Focus

Against this backdrop, below we highlight a few tech ETFs that have gained meaningfully last week. These tech ETFs include WisdomTree Cloud Computing Fund WCLD, iShares Expanded Tech-Software Sector ETF IGV, WisdomTree Cybersecurity Fund WCBR, Global X Cybersecurity ETF BUG, Amplify Cybersecurity ETF HACK and Amplify BlueStar Israel Technology ETF ITEQ. These ETFs gained in the range of 5%–8% last week.

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This article originally published on Zacks Investment Research (zacks.com).

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