Military Action in the Middle East Drives Market Declines
Markets finished lower as an early-week rally faded into a late-week selloff. Stocks initially rallied as President Trump said the “war is very complete, pretty much,” and oil prices plunged, but the strength reversed as geopolitical tensions escalated and oil rebounded.
The S&P 500 fell 2%, with Energy the only sector in positive territory. The Nasdaq had a smaller decline of 1.5% as investors rotated toward tech stocks and mega caps amid the volatility, while the Russell 2000 declined by 3%.
Bonds also traded lower as rising oil prices and inflation concerns pushed Treasury yields higher. Commodities were mixed: oil rebounded toward $100 per barrel as the Strait of Hormuz remained closed, while gold posted a modest loss despite the market volatility. The week ended with tensions unresolved.
Key Takeaways
1. Tensions Remain Elevated in the Middle East & Continue to Impact Markets
The Strait of Hormuz remains effectively closed, and the energy shock remains the dominant market story. Oil has increased by approximately 40% since the beginning of the war.
The VIX spiked to an 11-month high before partially recovering, and Fed rate-cut expectations for 2026 have dropped from three to one. Equity markets have held up better than might be expected, with the S&P 500 down less than 3% since the end of February.
The key question is how quickly oil flows normalize, which will determine whether the supply disruption is contained or becomes a drag on economic growth. Markets are likely to remain volatile until geopolitical tensions ease.
2. Labor Market Conditions Continue to Soften
The U.S. economy lost approximately 92,000 jobs in February, below expectations for an increase of 50,000–60,000 jobs. Prior months were also revised lower, with December flipping from a reported gain of 48,000 to a loss of 17,000, meaning the labor market has shed jobs in three of the past five months. Unemployment edged up to 4.4% from 4.3%.
Part of the weakness was due to a Kaiser Permanente strike that kept close to 31,000 healthcare workers off payroll during the survey period, though it has since been resolved. Labor market conditions put pressure on the Fed to resume cutting rates, though the timing remains uncertain heading into the March meeting this week.
While some of the weaknesses reflect temporary distortions, the broader trend points to a softening labor market.
Want to read more? Click below to download our entire market commentary…
Market Commentary 3/17/2026
Military Action in the Middle East Drives Market Declines
Markets finished lower as an early-week rally faded into a late-week selloff. Stocks initially rallied as President Trump said the “war is very complete, pretty much,” and oil prices plunged, but the strength reversed as geopolitical tensions escalated and oil rebounded.
The S&P 500 fell 2%, with Energy the only sector in positive territory. The Nasdaq had a smaller decline of 1.5% as investors rotated toward tech stocks and mega caps amid the volatility, while the Russell 2000 declined by 3%.
Bonds also traded lower as rising oil prices and inflation concerns pushed Treasury yields higher. Commodities were mixed: oil rebounded toward $100 per barrel as the Strait of Hormuz remained closed, while gold posted a modest loss despite the market volatility. The week ended with tensions unresolved.
Key Takeaways
1. Tensions Remain Elevated in the Middle East & Continue to Impact Markets
The Strait of Hormuz remains effectively closed, and the energy shock remains the dominant market story. Oil has increased by approximately 40% since the beginning of the war.
The VIX spiked to an 11-month high before partially recovering, and Fed rate-cut expectations for 2026 have dropped from three to one. Equity markets have held up better than might be expected, with the S&P 500 down less than 3% since the end of February.
The key question is how quickly oil flows normalize, which will determine whether the supply disruption is contained or becomes a drag on economic growth. Markets are likely to remain volatile until geopolitical tensions ease.
2. Labor Market Conditions Continue to Soften
The U.S. economy lost approximately 92,000 jobs in February, below expectations for an increase of 50,000–60,000 jobs. Prior months were also revised lower, with December flipping from a reported gain of 48,000 to a loss of 17,000, meaning the labor market has shed jobs in three of the past five months. Unemployment edged up to 4.4% from 4.3%.
Part of the weakness was due to a Kaiser Permanente strike that kept close to 31,000 healthcare workers off payroll during the survey period, though it has since been resolved. Labor market conditions put pressure on the Fed to resume cutting rates, though the timing remains uncertain heading into the March meeting this week.
While some of the weaknesses reflect temporary distortions, the broader trend points to a softening labor market.
Want to read more? Click below to download our entire market commentary…
S&P 500 Index is a capitalization-weighted index calculated on a total return basis with dividends reinvested. The index includes 500 widely held U.S. market industrial, utility, transportation and financial companies.
Russell 2000 Index measures the performance of the 2,000 smallest companies in the Russell 3000® Index, which represents approximately 8% of the total market capitalization of the Russell 3000 Index.
Wells Fargo Advisors Financial Network did not assist in the preparation of this report, and its accuracy and completeness are not guaranteed. The report herein is not a complete analysis of every material fact in respect to any company, industry or security. The opinions expressed here reflect the judgment of the author as of the date of the report and are subject to change without notice. Any market prices are only indications of market values and are subject to change. The material has been prepared or is distributed solely for information purposes and is not a solicitation or an offer to buy any security or instrument or to participate in any trading strategy. Additional information is available upon request. 5308294
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Monthly Market Commentary February 2026
Markets finished lower as an early-week rally faded into a late-week selloff. Stocks initially rallied as President Trump said the “war is very complete, pretty much” and oil prices plunged, but the strength reversed as geopolitical tensions escalated and oil rebounded. The S&P 500 fell 2%, with Energy the only sector in positive territory. The Nasdaq had a smaller decline of 1.5% as investors rotated toward tech stocks and mega caps amid the volatility, while the Russell 2000 declined by 3%. Bonds also traded lower as rising oil prices and inflation concerns pushed Treasury yields higher. Commodities were mixed: oil rebounded toward $100 per barrel as the Strait of Hormuz remained closed, while gold posted a modest loss despite the market volatility. The week ended with tensions unresolved.
Oxford Harriman & Company Announces the Addition of Robert Wert and His Team to Its Expanding National Wealth-Advisory Platform
Oxford Harriman & Company Announces the Addition of Robert Wert and His Team to Its Expanding National Wealth-Advisory Platform