As we close Q1 2026, markets operated amid intense geopolitical flux surrounding the Mideast war, layered on top of steady-but-mixed domestic economic data and anticipation for the March employment report. This week, we look at the impact of conflicting war-related headlines, the energy-market, consumer confidence, and the always anticipated upcoming US Nonfarm payrolls. Equity markets traded choppy for most of the week but finished the month and quarter with a late rebound, while bond yields eased slightly and commodities—particularly oil and gas—showed notable volatility.¹

Market Reaction to Iran Peace Announcement

Today’s reports that Iran is prepared to end the war triggered an immediate and pronounced risk-on move across global markets. U.S. equities reversed earlier weekly losses, with the S&P 500 rallying more than 1.8% intraday and closing up approximately 1.4% on the day. The Dow Jones Industrial Average gained over 400 points, and the Nasdaq 100 rose roughly 1.7%, as investors priced in the potential for de-escalation and restored stability in energy supply routes.¹ Oil prices plunged sharply in response: West Texas Intermediate (WTI) crude fell as much as 6% at the open before settling down about 4.2% near $101 per barrel, while natural gas prices eased similarly on reduced disruption fears.¹ Defense and energy equities diverged, with the former declining on a lower geopolitical risk premium and the latter mixed amid the price drop. President Trump’s subsequent statement that the U.S. will exit Iran in 2–3 weeks further amplified the intraday volatility but ultimately reinforced the de-escalation narrative.²

Market Overview

U.S. equities exhibited choppy performance through most of the week before today’s peace signals provided a late lift, leaving major indexes modestly mixed to slightly higher for the period. Fixed-income markets saw Treasury yields tick lower, with the 10-year yield closing near 4.25%. Commodities provided the clearest directional moves earlier in the week before today’s reversal.³

Key Economic Releases

Economic data this week remained consistent with a resilient but cooling backdrop, with consumer sentiment offering a modestly positive surprise ahead of Friday’s critical employment print.

• March 2026 University of Michigan Consumer Sentiment: Released today, the final March index rose to 70.1 from February’s 63.4, topping consensus expectations of 66.0 and marking the highest reading since last October. Consumers cited stable inflation expectations and resilient spending plans despite geopolitical noise.⁴
• Upcoming March 2026 Nonfarm Payrolls on Good Friday: Markets are pricing in a consensus gain of approximately 140,000 jobs, with the unemployment rate expected to hold  steady at 4.2%.⁵  Average hourly earnings are forecast to rise 0.3% month-over-month. A print materially below expectations could reinforce concerns about labor-market softening, while a stronger figure would support the soft-landing narrative.⁵

Geopolitical Tensions and Mideast War Developments

Market action this week unfolded against a backdrop of conflicting and constantly changing news about the Mideast war. The rapid shift from escalation fears to today’s peace signals produced significant whipsaw trading, particularly in defense and energy equities.¹

The war-related headlines had a direct and volatile impact on oil and gas prices throughout the week, with today’s announcement accelerating the downside move in crude.¹

Outlook

With March consumer sentiment showing modest improvement, today’s equity rally on de-escalation hopes, and the economy still demonstrating underlying resilience, the U.S. backdrop remains constructive despite labor-market softening signals. However, the Mideast war’s conflicting developments and their dire effects on energy prices add a layer of near-term volatility that could influence inflation expectations.  

Friday’s nonfarm payrolls will be closely watched as a key test of labor-market health. In uncertain times, we are sticking to our long term investing game plan, with high-quality, diversified portfolios tailored to client’s risk/return profiles.⁵

Best regards,

Richard Barnett

Chief Investment Officer

Footnotes:

1. Bloomberg News, Market Wrap, 3/31/26, https://www.bloomberg.com/news/articles/2026-03-31/asian-stocks-set-to-track-us-rally-on-iran-hopes-markets-wrap

2. WSJ, Trump Says US will Be Leaving Iran in 2-3 weeks, 3/31/26, https://www.wsj.com/livecoverage/iran-war-news-updates

3. Market data from Bloomberg and Reuters intraday reports, March 31, 2026

4. University of Michigan, Surveys of Consumers – March 2026 Final, https://www.sca.isr.umich.edu/

5. Bloomberg News, US Job Openings Fell in February, Hiring Slowest Since 2020, 3/31/26, https://www.bloomberg.com/news/articles/2026-03-31/us-job-openings-fell-in-february-from-a-multi-month-high

Researched and compiled with the assistance of Grok4. This newsletter represents our opined general assessment of the market environment at a specific time and is not intended to be a forecast or guarantee of future performance or results. The opinions and statements expressed are intended for information purposes only and do not constitute investment advice, a recommendation, or an offer or solicitation to purchase or sell any securities or investment strategies. Investing involves risks. Past performance is not a reliable indicator of current or future results. Opinions are as of March 31, 2026 and are subject to change without notice.

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