Market Update
- Fed Day (and Central Bank Week)
- Escalation as Iranian energy infrastructure hit
- Equities lower, Dollar, yields higher
- Hot PPI print
- Check out some of the recent ICE Data/Content:
- Inside The ICE House
- Episode 519: Bar Rescue's Jon Taffer on Saving Bars, Guiding Owners, and Driving Season 10
- ETF Central: Team Epiphany Founder & CEO Coltrane Curtis
- NYSE Research Insights: Fractional Reporting Early Findings
- March 2026 ICE Mortgage Monitor Report: Q4 Lending Climbs to 3.5-Year High as Refinance Activity Accelerates and Servicer Retention Strengthens
- Market Story Lines
MAC Desk Commentary:
St. Patrick’s Day rolled into Fed Day as the long holiday continues. Unfortunately equities are under pressure as oil continued its climb after hostilities in Iran escalated to hits on energy infrastructure. Yesterday US markets ended in the green. The highs were hit early in the session with the S&P 500 topping out ~6,750, where the market has run into resistance over the last few sessions. Oil prices continued to move higher with energy stocks leading to the upside. Financials outperformed helped by a bounce in many of the private credit exposed companies. Despite the continued move higher in energy markets travel-related stocks also traded well after a positive update from Delta.
Futures had been moving higher throughout the overnight session with strength in Asia but turned lower after reports that Israel struck Iran’s South Pars gas field. Iran vowed to retaliate against sites that were previously thought to be safe. Futures took another leg lower after PPI came in well ahead of estimates before the Open. The headlines are stacking up in front of the Fed decision and press conference later today. The S&P 500 opened down about 0.3% and extended lower. The Dow is lagging, Russell 2000 equaling the S&P 500 and the equal-weight is outperforming slightly.
With oil moving higher Consumer Discretionary is among the worst performing sectors- though Macy’s is higher after an earnings beat- but Staples is actually down more despite General Mills’ maintaining guidance and speaking positively about next fiscal quarter and year. That had kept the stock treading water before slipping into the red. Healthcare and Materials are also lagging, but a few managed care names are providing some defensive cover in Healthcare. Energy is again leading and Industrials is trying to stay green with aerospace/defense and machinery/construction names providing some uplift.
This afternoon the Federal Reserve is widely expected to leave rates unchanged with potentially three dissents, which would be the first time since 1988. Investors will comb through the Summary of Economic Projections (SEP) for clues as to how the Committee is thinking about the conflict and balance of risks. Markets have priced out the prospect of rate cuts over the last few weeks. Most expect the SEP to show 1 rate cut through the remainder of the year. We’ll have Fed recap later today.
In macro data, PPI came in hot with headline and core up 3.4% and 3.9% on an annual basis versus expectations of 2.9% and 3.7% respectively. The reading increased for the fourth straight month (m/m basis), with each month showing incrementally larger increases (0.3% in November, 0.7% in February). Goods rose 1.1%- the largest increase since August 2.3%, with Foods and Energy both up over 2% to drive the total. There was some outlier internals that moved the index. Over 20% of the Goods increase was due to a ~50% increase in vegetables. We also haven’t tamed the egg inflation beast just yet as prices jumped over 90% after declining 64% last month. Goods ex-Food and Energy was a much more modest 0.3%. Services PPI rose 0.5%. 20% of that was from a jump in travel accommodations.
Yields moved about 2bp higher after the print and the front end has added a little bit more to that, but its likely that anything else is on hold pending Fed decision. The USD Index moved to its highest levels of the day following the print, nearing 100 before pulling back a bit.
- US 2yr +3bps to 3.71%, 5yr +3bps to 3.82%, 10yr +3bps to 4.23%, 30yr +2bps to 4.86%
- USD index: +$0.28 to $99.61
Oil prices have been moving higher with ICE Brent up 5% hitting the highest level since the re-open of futures on the Sunday following the start of the operation. With the risk-off tone , Dollar strength and potential for demand destruction from oil prices, the metals complex is selling off. Gold and silver are down 3-4%, with gold falling below its 50d ma ~4,970. It hasn’t closed below the 50d since August. Ag is higher with corn and wheat rising on updates of growing conditions and ethanol stocks.
Crypto is taking it on the chin in the risk-off environment. Bticoin and Ether are down ~5%. Overnight the CFTC and SEC issued joint guidance classifying crypto tokens into five distinct categories: digital commodities, digital collectibles, digital tools, stablecoins and digital securities. The Block wrote, “The new interpretation details a token taxonomy for stablecoins, digital commodities, and "digital tools," all of which the agency said are not securities. It also seeks to address how a "non-security crypto asset" could become a security, and clarifies how federal securities laws apply to mining, protocol staking, and airdrops”. This regulatory development comes as another piece of clarity, the CLARITY Act, has stalled out like my first car, a Volvo 240 Turbo. Right around the time the complex broke to the downside there were also headlines out of the UK calling for an “immediate moratorium” on crypto political donations.
Earnings:
- After-Market: FIVE, MU
- Pre-Market (Thrs): ACN, AON, BABA, DRI, LUNR, SIG
- After-Market (Thrs): AFDX, FDX, GEMI, PL, SCHL, TMC, UAMY, YSS
Economic Data:
US:
- Mortgage apps: 0.9% vs prior 7.8%
- Refis: -18.5% vs prior 0.5%
- 30yr rate: 6.3% vs prior 6.19%
- Feb PPI m.m / y.y: 0.7% / 3.4% vs. 0.3% / 2.9% cons., prior 0.5% / 2.9%
- Feb Core PPI: 0.5% / 3.9% vs. 0.3% / 3.7% cons., prior 0.8% / 3.6%
- Factory Orders (January): +0.1% vs 0.1% cons, prior -0.4%
- Ex-transport: 0.4% vs prior 0.6%
- API Oil Inventories (AMC Tues): 6.6M vs -0.6M cons, prior -1.7M
- EIA Oil Inventories: 6.156M vs 0.4M cons, prior 3.824M
- 2:00 FOMC Policy Decision (Summary of Economic Projections)
- 2:30 Powell Presser
Global:
- South Korea Unemployment: 2.9% prior 3%
- Japan Exports: 4.2% vs. 1.6% cons., prior 16.8%
- Japan Imports: 10.2% vs. 11.5% cons., prior -2.6%
