Commentary for March, 2026

Hello all - we hope you had a better March than the markets did.  

What a month.  The war in Iran sent stocks to their worst month in four years, while commodities like oil saw record gains.  For stocks, the Dow was down 4.6%, the S&P 500 lost 5.0%, and the Nasdaq, which has a higher concentration of tech stocks, was off 3.4%.  

We also closed out the first quarter, which was the worst quarter in four years.

Here’s a look at how the markets moved this month:

Here’s a look at how the various market sectors performed this month.

Needless to say, the markets were incredibly volatile this month.

Volatility in the bond market was also high.  We don’t talk about this very often, but the volatility in the bond markets often mirrors the level of the stock market.  

As you can see in the chart below, the gap between the two indexes has widened.

Will the stock market (black line) fall further to catch up with the bond market (blue line), or will the bond market rise to catch up to stocks?

Not everything was down, though.  With the rise in oil prices, energy stocks did very well.

We talked about natural resources companies last month, since they were immune to AI slowdowns. These are companies like Exxon, Newmont Mining, and Freeport McMoran.  This sector also held up well during the chaos of this month. 

____

As you are clearly aware, oil and gas prices have seen a historical rise this month.  Oil, in particular, saw its biggest monthly gain, ever. 

Here’s a look at the rise in gas prices:

Interestingly, as oil rose, stocks fell.

Why did stocks fall as oil rose?  It goes back to the Fed.  Higher gas prices mean higher inflation.  Higher inflation means the Fed is less likely to lower interest rates this year.  In fact, the market is predicting no rate cuts this year.  Some even think there could be a rate hike.

This caused the U.S. dollar to have its best month since 2024.

It also caused gold to fall. 

____

FED

Speaking of the Fed – and switching gears a bit – the Fed held another policy meeting this month.

They held rates steady, as expected, and signaled that it’s possible there will be fewer rate cuts this year than people expect.  This added to the pressure in the markets. 

____

INFLATION

Inflation numbers released this month showed a slight increase in inflation.  Note that this number was measuring inflation the month before the Iran war started. 

The month-to-month number shows inflation still rising, too.

When excluding food and energy (what economists call the “core” inflation), prices keep climbing.

The most surprising inflation number out this month was the PPI.  It showed inflation at the business level was much higher than expected.

____

OTHER ECONOMIC DATA

Other economic data releases were mixed this month.

The unemployment picture looks very poor as we saw a surprising drop in jobs.

The strength of the manufacturing and service sectors continues to hold up, though.

Retail sales were slightly lower.

Durable goods were lower, too, but when excluding a few large aircraft orders, the durable goods weren’t that bad.

Consumer confidence continues to be an issue.  It showed slight improvement in the last two reports, but it has been trending lower, overall.

Small business optimism was slightly lower.

____

Where does the market go from here?

Stocks look very, very oversold (cheap) and it’s a very attractive time to buy here.   As the month closed out, the risks with the Iran war seemed to fade, so a wind down in the conflict will be very beneficial for investors.  However, there’s no telling what may actually happen. 

 

Lastly, we will note that after oil shocks like we just saw, markets tend to languish so any rebound may be short-lived.

This commentary is for informational purposes and is not investment advice, an indicator of future performance, a solicitation, an offer to buy or sell, or a recommendation for any security. It should not be used as a primary basis for making investment decisions. Consider your own financial circumstances and goals carefully before investing. Past performance cannot guarantee results.

Commentary for February, 2026

Hello all - we hope you had a nice January.  

It was a very lackluster month for the markets.  The Dow was up slightly with a 0.2% gain, the S&P 500 lost 0.9%, and the Nasdaq, which has a higher concentration of tech stocks, had a rough month with a 3.4% loss. 

Here’s a look at how the markets moved this month:

Here’s a look at how the various market sectors performed this month.

The markets are becoming a little more volatile, though still not at a very high level.

Tech was again a big topic this month, with AI being the focus.  The take on AI has ranged from it being a savior, a disruptor, and even a job-killer.  

The software industry is seen as being ripe for disruption from AI, where the thinking is that AI can do most of the work these companies did.  This sector, which has names like Microsoft,  Oracle, and Adobe, started selling off hard last month and it stayed lower this month. 

On the other hand, businesses that appear immune from AI disruption have done very well.  The natural resources sector has received a lot of attention because of this.  These are companies like Exxon, Newmont Mining, and Freeport McMoran.  

You can see in the chart below just how well this sector is performing. 

Also, we noticed an interesting correlation between the performance of the software sector and Bitcoin.  Take a look at the chart below and you can see how closely they trade together.

Finally, the metals have done very well, too.  They lost some ground after a very sharp rally in January, but they recovered this month and resumed their climb.  

Here’s a look at gold, whose price continues to skyrocket:

____

MARKETS

While AI was one big story, the tariffs were another big story affecting the markets.

Markets initially rallied on the news since it would be less costs for businesses.  However, it looks like President Trump has other ways of implementing tariffs, so there may be only little relief. 

 

Either way, the markets are expecting more volatility to come from the uncertainty around tariffs now.

____

INFLATION

The inflation numbers released this month showed that on an annual measurement, inflation was mild.

However, when we look at inflation month-by-month, prices are clearly still rising.

When excluding food and energy (what economists call the “core” inflation), prices are still higher every month.

Inflation at the business level came in higher than expected, too.

____

OTHER ECONOMIC DATA

Other economic data releases were mixed this month, too.

The unemployment picture improved over last month, but it still looks weak as very few jobs are being added.

The amount of job openings continues to fall, too. 

Could this be the result of AI, like we talked about earlier in this commentary?  The drop in job openings for “professional services” is alarming.

As for the broader economy, the economy grew at a pace much lower than many economists anticipated.  

Here’s a look at the most recent GDP report, which was far below the 3-4% many were expecting (though the government shutdown is believed to have reduced this figure by 1.5%).

While the GDP showed weakness, a look at both the manufacturing and service sides of the economy showed strength.

Retail sales were flat.

Durable goods were lower, too, but when excluding a few large aircraft orders, the durable goods weren’t that bad. 

Consumer confidence continues to be an issue.  It showed slight improvement in the recent report, but it has been trending lower.

Small business optimism rose slightly, too.

____

Where does the market go from here?

***Post month-end market close update***

The attack in Iran at the end of February changed information we were planning to write in this section.  We were leaning cautious, and the attacks are likely to pressure the markets in the near term.  However, attacks like this have historically been good buying opportunities. 

This commentary is for informational purposes and is not investment advice, an indicator of future performance, a solicitation, an offer to buy or sell, or a recommendation for any security. It should not be used as a primary basis for making investment decisions. Consider your own financial circumstances and goals carefully before investing. Past performance cannot guarantee results.