MARKET COMMENTARY
The stock market rallied last week following the announcement of a two-week ceasefire between the U.S. and Iran, but sentiment quickly reversed as new weekend talks failed to produce a lasting agreement. While both sides have reportedly found common ground on several issues, nuclear discussions remain a major sticking point, leaving a cloud of uncertainty over global markets. Tensions escalated further as the U.S. military maintained its blockade of the Strait of Hormuz, with warnings that any vessels approaching the restricted zone could be intercepted or destroyed. That development reignited supply concerns and contributed to Monday’s risk-off mood, with futures pulling back as investors reassessed the geopolitical landscape.
Last week’s CPI report underscored the economic fallout from ongoing conflict, recording the largest monthly price gain since June 2022. Gasoline costs surged 21.2%, marking the biggest single-month jump since 1967. The inflation spike has cast doubt on the likelihood of a near-term Fed rate cut, reminding markets that geopolitical shocks can quickly upend the disinflation narrative in the beginning of this year.
Attention now turns to the start of earnings season, led by major financial institutions. Banks entered 2026 with optimism surrounding a soft-landing scenario, but that enthusiasm has faded as the sector became one of the year’s weakest performers. This week’s results could serve as a turning point, whether management teams can present a credible path to recovery or signal more caution amid compressing margins, slower credit growth, and lingering market volatility.
Economic Releases This Week
Monday: Existing Home Sales
Tuesday: Producer Price Index
Wednesday: Home Builder Confidence Index
Thursday: Initial Jobless Claims
Friday: None
Stories to Start the Week
Trump vows to sink Iranian ships approaching a U.S. blockade of Strait of Hormuz
Iran war’s economic shock wave is expected to get even bigger
Masters 2026: Rory Mcllroy makes history by going back-to-back at Augusta
Artemis II Was a Blockbuster. Landing on the Moon Will Be a Lot Harder
Disclousure:
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