Week In Review - Iran, Oil, and a Market Running on Fumes

Markets had one job last week: function.

They didn't.

The S&P 500 dropped 1.6% and closed at a fresh 2026 low. The Dow gave back 2.0%. The Nasdaq slipped below its 200-day moving average like a kid sneaking out past curfew, except everyone noticed and nobody could do anything about it.

Every single session opened with oil headlines. Every single session closed with investors wondering if the Fed would ride to the rescue. By Friday, the verdict was in: it wouldn't. It couldn't. The cavalry got stuck in traffic behind a fuel tanker, ironically enough.

One geopolitical variable reprogrammed the entire market's math. Not earnings. Not AI hype. Not a TikTok ban. A shipping lane.

Sound familiar? It shouldn't. This was supposed to be the year macro took a back seat. Spoiler: Macro stole the car.

Energy was up 2.1%. Everything else got punished for not being oil.

Here's the short list:

On rates: the 2-year surged 17 basis points to 3.73%. The 10-year climbed 16 bps to 4.29%. Investors priced in inflation they couldn't see in the data yet, but could absolutely smell at the gas pump.

Translation: the bond market doesn't need a CPI print to tell it what $95 crude means. Neither should you.

The February jobs report showed a 92,000-job drop. Expectations were +55,000. Unemployment climbed to 4.4%.

In a normal world, the Fed sprints to cut rates. This is not a normal world. Oil had already breached $100. The Strait of Hormuz was choking under Iran's new Supreme Leader, Mojtaba Khamenei. The Fed found itself staring down simultaneous labor weakness and an oil-driven supply shock.

That's the monetary policy equivalent of being asked to fight a fire while standing in a flood.

Morgan Stanley's Ellen Zentner called it: rock, meet hard place. That setup defined every trade for the next five days.

Could go either way, honestly. Just kidding. It went badly.

Oil briefly flirted with $120 at the open. Major averages dumped over 1% before most traders finished their coffee. The Nasdaq dipped below its 200-day.

Then, President Trump appeared on CBS and casually suggested the Iran war "could be over soon." He also floated the idea of the U.S. "taking over" the Strait of Hormuz. A comment so geopolitically ambitious it somehow doubled as a market catalyst.

Crude cratered from $94 to roughly $85 by mid-afternoon. The S&P reversed to close up 0.8%. The Nasdaq finished up 1.4%.

Meanwhile, Hims & Hers Health surged 41% after settling a lawsuit with Novo Nordisk and landing distribution rights for Wegovy and Ozempic. On a day where the planet was pricing in a potential naval war, a telehealth company reminded everyone that GLP-1 distribution scale is still worth billions.

Markets: where geopolitics and weight loss drugs coexist. We are a serious civilization.

Crude fell another $10.88. That's 11.5%. Trump's peace comments were still doing heavy lifting.

Then reality showed up. Reuters reported Iranian officials had zero intention of lifting the blockade. Energy Secretary Chris Wright posted on X that a U.S. Navy escort had safely guided a tanker through the Strait. CNBC disputed it. The White House confirmed it never actually happened.

Let that sink in. The Energy Secretary posted a military operation on social media that didn't occur. The market briefly traded on a fiction. And then, because this week wasn't done, U.S. intelligence reported Iran may have started laying naval mines in the shipping lanes.

Stocks gave back their gains and closed near flat.

Here's the thing: when the government can't agree on what its own Navy did today, maybe don't base your portfolio allocation on the next tweet.

The IEA coordinated the release of 400 million barrels from strategic reserves. The largest coordinated release in history. The market's response? Oil closed 3.6% higher.

Four hundred million barrels. Price went up. That's not a supply story. That's a confidence story. And confidence just filed for bankruptcy.

February CPI came in exactly on target. 0.3% headline. 0.2% core. In any other week, that's a champagne pop. This week, nobody even looked. BlackRock's Rick Rieder said the quiet part out loud: this is a supply shock, not demand-driven inflation. A supply shock reduces demand, consumption, and growth.

Translation: the CPI print is already stale. The oil shock hasn't yet hit the data. When it does, enjoy that crisis.

Under the surface, JPMorgan started marking down private credit portfolios tied to software debt. Cliffwater's flagship private credit fund saw redemptions exceed 7%. Financials sold off quietly. Persistently. The kind of bleed that doesn't trend on Twitter but absolutely shows up in your retirement account.

Crude surged 10.2% to $95.72. Iran's Supreme Leader made his position explicit. More tankers were struck.

Rate-cut expectations didn't just deteriorate. They died. CME FedWatch showed less than 50% odds for even a single 25-basis-point cut before December. That's not "higher for longer." That's "higher, possibly forever, good luck."

Southwest fell 7.74%. Old Dominion dropped 6.64%. Same math, same answer: fuel costs above $90 don't work.

The private credit story escalated from "credit concern" to "liquidity crisis" when Bloomberg reported Morgan Stanley and Cliffwater had capped investor withdrawals entirely. Locked the doors. Turned off the exit signs.

Here's the difference between a credit problem and a liquidity problem: a credit problem means you might lose money. A liquidity problem means you can't get your money out to lose it.

Sleep well.

Q4 GDP was revised to 0.7%. Half of the already-weak 1.4% advance estimate. The GDP price deflator was revised up to 3.8%.

Slower growth. Higher prices. That's stagflation on paper. In a PowerPoint. In your portfolio.

Core PCE edged to 3.1% year-over-year. The Fed's preferred inflation gauge is moving in the wrong direction, and that's before a single drop of $95 crude shows up in the data.

JOLTS surprised to the upside at 6.946 million openings. The week's only labor bright spot. Participation trophy energy.

Adobe beat earnings expectations but still dropped 7.6% because the CEO quit. When your AI strategy is murky, no quarterly result saves you.

Meta confirmed its next-gen AI model would be delayed. Down 3.8%. Dragging communication services with it.

University of Michigan Consumer Sentiment hit 55.5. Half the respondents answered before the military escalation. The final number will be worse. Probably significantly worse.

Let's review: GDP revised down. Inflation revised up. AI delayed. CEOs leaving. Consumer confidence is collapsing. Oil at $95.

Other than that, great week.

Prediction markets are doing what they do best right now: being brutally honest while everyone else hedges.

Translation: prediction markets, bond yields, and consumer sentiment are all whispering the same thing. This isn't a blip. This looks like a regime shift.

Works every time. Probably.

Gold hovered at roughly $5,097–$5,181 per ounce this week.

Here's what's interesting: it didn't rip higher.

Tankers struck. GDP at 0.7%. Private credit funds are locking doors. By any historical playbook, gold should have been sprinting. Instead, it traded sideways, pinned by a firmer dollar and rising real yields.

The paradox: inflation expectations are supporting rates even as growth softens. Higher real rates cap the yield on a zero-yield asset. So gold sits in a standoff. Geopolitical fear builds the floor. Rate math limits the ceiling.

If the Fed's hawkish posture cracks before the economy does, gold has a clear runway. Until then, it's stuck in a tension zone that mirrors the broader macro uncertainty almost perfectly.

Even the safe haven can't decide if it's safe. That tells you everything.

February existing home sales beat expectations: 4.09 million vs. a consensus of 3.88 million.

Don't celebrate. Median prices have risen for 32 consecutive months. That's not a healing market. That's a market that repriced itself into a permanently higher bracket and dared you to keep up.

January housing starts surprised to the upside, rising to 1.487 million. But single-family starts actually declined 2.8%. The beat came from multi-unit construction. We're building apartments faster than homes. Great for renters. Useless for first-time buyers.

The Senate passed the 21st Century ROAD to Housing Act by a vote of 89–10. Bipartisan. Co-authored by Tim Scott and Elizabeth Warren. The most significant housing legislation in roughly two decades. It now faces a House where institutional investor lobbying groups are already organizing opposition.

Bipartisanship: the thing that happens in the Senate right before the House kills it.

Meanwhile, the 10-year climbed 16 basis points to 4.29%. Mortgage rates moved higher in lockstep. Affordability deteriorated at the exact moment political will to fix the problem reached its highest point in a generation.

The iShares U.S. Home Construction ETF fell 5.4%.

Timing is everything. And the timing here is catastrophic.

Retail investors spent the week toggling between "buy the dip" muscle memory and the dawning realization that the dip might not have a bottom.

Institutional desks were quieter. Smarter. Rotating into energy and defensives, trimming software and private-credit-adjacent financials well before those trades got crowded. The kind of repositioning that never trends on social media but absolutely shows up in sector performance.

Here's what's different this time: there's no safety blanket. No "just wait for the Fed pivot." Rate-cut expectations are gone. GDP is printing below 1%. The crowd-sourced anxiety on financial Twitter feels less like fear of missing out and more like fear of being wrong about where the floor is.

Spoiler: nobody knows where the floor is. That's the floor.

Monday's intraday rally arrived warm and encouraging. A nice appetizer. Hope on a plate.

By Thursday, the entrée showed up cold, overpriced, and visibly on fire. The IEA tried to comp the table with 400 million free barrels. The kitchen acknowledged the gesture. Then charged $3 more per barrel anyway.

That's what happens when the supply shock is being run by someone who doesn't read G7 Yelp reviews.

Most fitting detail of the week: McDonald's chose this exact moment to launch McValue 2.0. Three-dollar items. Four-dollar breakfast meals.

Either a savvy consumer staples play or the most brutally honest economic indicator of the quarter.

You're welcome.

The week of March 7–13 was when markets stopped treating the Iran conflict as a headline and began pricing it as a structural reality.

The IEA dumped 400 million barrels. Oil went up. That's not a market responding to supply. That's a market that doesn't believe the supply will last.

GDP revised to 0.7%. Jobs already posted a shocking miss. Core PCE nudging higher. The Fed can't cut without handing inflation a permission slip. Private credit funds are locking doors.

Energy outperformed. Semis held. Defensives did their job. Everything else reminded you that drawdowns don't happen all at once. They drain slowly. Then something specific gives way.

The Strait of Hormuz is the chokepoint in the physical oil market and in every investor's thesis. When ships move freely again, a meaningful portion of this pressure decompresses fast.

When that happens? Nobody on Wall Street has a credible answer.

And that's the one question that actually matters.

Enjoy that crisis.