Markets were acutely aware of news abroad again this week. Will energy concerns be the tail that wags the economic dog?
Monday
S&P 500 0.83% | NASDAQ 1.38%
Major indexes recovered early losses as fears of a prolonged energy crisis gripped markets. Optimism around a near-term end to operations in Iran fueled a comeback. Technology sought to recover last week’s losses.
Tuesday
S&P 500 0.21% | NASDAQ 0.01%
Monday’s spike with oil prices following the shutdown of the Straight of Hormuz caused further angst in energy markets. A barrel of oil skyrocketed to $119 which could trickle into consumer spending as the war goes on. Existing home sales were a bright spot for sellers in February.
Wednesday
S&P 500 0.08% | NASDAQ 0.08%
A mid-week calm came over markets as equities assessed geopolitical tensions. Measures were taken via the International Energy Agency to bring down energy prices, somewhat stabilizing equity markets. The Consumer Price Index came in flat which will give guidance to Federal Reserve on the direction of inflation.
Thursday
S&P 500 1.52% | NASDAQ 1.78%
Markets tumbled as energy supply disruption shocked risk assets again. Projections for another rate cut by the Federal Reserve in the first half of the year have fallen dramatically. The 10-year treasury climbed higher on the possibility of a sustained inflationary pinch.
Friday
S&P 500 0.61% | NASDAQ 0.93%
Aside from the weeklong uncertainty in energy, economic data in the U.S. was positive. Job openings edged higher and sentiment showed signs of improvement. The stage had been set for a turbulent week with disruptions abroad and markets didn’t have an appetite for risk.
Conclusion
S&P 500 1.60% | NASDAQ 1.26%
Equities were hit for a 3rd consecutive week as there remain more questions than answers regarding recent geopolitical events. Markets were acutely aware of energy markets, in particular. Oil prices continue to swing violently as officials seek to temper concerns about the duration of current operations. In the near term, the price at the pump will remain elevated as efforts for price control remain a top priority. Aside from heightened international unknows, the U.S. remains resilient. Tax season is upon us, and a large majority of taxpayers could be due for a bigger refund this year. If spending were to be squeezed there might be a reprieve in the way of offsetting those increased costs. Although there has been an increase in swings recently, international events don’t necessarily represent trends for the rest of 2026. It is key to stay diversified in an evolving situation and even more essential to rely on fundamentals as opposed to speculation.
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