In the wake of a tumultuous week marked by soaring oil prices, investors are keeping a close watch for any signs of relief as the conflict between the U.S., Israel, and Iran enters its third week. The three major stock market indices all posted losses, with declines of at least 1% for the week, while oil prices surged significantly, further complicating the economic landscape.
On Friday, both Brent crude and U.S. West Texas Intermediate (WTI) recorded increases of about 3%, pushing week-to-date gains to more than 11% and over 8%, respectively. The volatility has pushed stock prices down to new low points for 2026. Sameer Samana, head of global equities and real assets at Wells Fargo Investment Institute, emphasized that “the conflict in the Middle East and related headlines are still the major source of fluctuations in markets.” He noted that the key factor is the length of the closure in the crucial Strait of Hormuz, a vital conduit for roughly 20% of the world’s petroleum consumption, which has been effectively shut down since the onset of hostilities. Iranian Supreme Leader Mojtaba Khamenei has asserted that the strait should remain closed as a means of exerting pressure on adversaries.
Adding to the uncertainty, U.S. Energy Secretary Chris Wright disclosed that the Navy is not currently positioned to escort tankers through the Strait of Hormuz but indicated that it will likely be ready to do so by the end of the month. This week saw Brent futures settle above $100 per barrel for the first time since August 2022, while WTI reached a peak of $119.48 at the beginning of the week before adjusting downward following comments from President Donald Trump regarding a potential swift resolution to the conflict.
Despite these challenges, Samana expressed a more optimistic outlook for investors, urging them to look beyond current headlines and focus on the underlying economic growth and corporate earnings potential. He forecasts that WTI will eventually stabilize between $65 and $75 per barrel.
Meanwhile, Nvidia may provide a glimmer of hope for the broader market. The company is gearing up for its GTC conference from March 16 to 19, and Wall Street analysts are reiterating their positive views on Nvidia ahead of this event. Analyst Timm Schulze-Melander from Rothschild & Co. Redburn believes that unless oil prices skyrocket to $150 per barrel, Nvidia will likely capture investor attention. He anticipates the company will outline strategies to dominate AI inference, an area poised for significant growth.
The conference comes at a pivotal moment for the AI industry, as technology firms ramp up investments while grappling with uncertainties around returns. The potential for disruption across various sectors, such as software and trucking, has also cast shadows over market sentiment.
In addition to these developments, traders are looking ahead to the second Federal Reserve policy meeting of the year, which is expected to yield few surprises. While the probability of a rate cut is virtually non-existent, traders hope to glean insights about potential future cuts. Will McGough, chief investment officer at Prime Capital Financial, acknowledged the Fed is navigating conflicting economic signals—with a somewhat weak labor market suggesting a cut, while persistent inflation hints at tightening measures.
Looking ahead, a busy week of economic releases will kick off with the Empire State Index on Monday, followed by capacity utilization, industrial production, and the NAHB housing market index. Amidst the fluctuating headlines, investors are urged to maintain focus on core strategies for long-term wealth building, as market fluctuations are inevitable.
