Stocks Soar as Trump Cites Talks, Delays Strikes

Published as of: March 23, 2026, 9:18 a.m. ET

(Monday market open) Wall Street mounted a dramatic comeback to start the new week on President Trump's post that the U.S. and Iran are having "very good and productive conversations" and he's postponing threatened strikes against the country's power plants by five days. The news at 7 a.m. ET reversed nearly 1% overnight losses and turned them quickly into 2% gains, while crude oil fell a swift 8%. In a follow-up post, Trump said the U.S. is "getting very close to meeting our objectives" and is "very intent on making a deal with Iran."

Today's quick pivot from red light to green light on two short Trump posts despite continued closure of the vital Strait of Hormuz highlight how markets continue focusing almost solely on this one geopolitical crisis. "The market psychology appears to be hijacked by the Iran war, as stocks are generally moving inverse of oil prices on a day-to-day basis," said Nathan Peterson, director of derivatives research and strategy at the Schwab Center for Financial Research, or SCFR, in his Weekly Trader's Outlook.

Friday saw major indexes crater to six-month lows in a fourth straight week of losses as the small-cap Russell 2000^® Index (RUT) entered correction territory, down more than 10% from its recent high close. Only a flutter of buying in the very last moments prevented a 2% daily decline for the S&P 500 Index. "The main investor focus appears to be 'how long' the war will last, and 'how high and for how long' oil prices remain elevated," Peterson said. That depends on how long the Strait remains closed, and investors will monitor for any signs of ships going through after Trump's statements today. However, Iran's news agency soon denied that talks have occurred and said, "there will be no peace in the energy markets," CNBC reported.

1. "Resilience" depends on where one looks: Though some analysts have described markets as "resilient" since the war began, that's a bit of a misnomer. Major indexes haven't fallen too dramatically. That's not the case for individual stocks. "The average member within the S&P 500 has had a 16% maximum drawdown, year-to-date," said Liz Ann Sonders, chief investment strategist at SCFR, speaking late last week in Schwab's On Investing podcast. "And it's more stark for the Nasdaq. The Nasdaq's had a little bit more of an index-level drawdown, but the average member has now had a -30% drawdown year-to-date. So that's where you're seeing a lot more of the action, under the surface." Meanwhile, the Treasury market, historically a place investors flock to for perceived "safety" during geopolitical turbulence, hasn't behaved that way this time.
    
2. China's market outperformance reflects crude security: Chinese stocks struggled last week and Monday but may have a leg up on some other Asian markets. "China is heavily dependent on oil from Iran but has a substantial strategic petroleum reserve that has insulated it from some of the downside risks, and 70% of its gas needs are met from domestic sources," said Michelle Gibley, director of international equity research and strategy at SCFR. "However, if global growth slows, China's manufacturers will feel it." Last week featured positive data including a larger-than-expected rise in February industrial production of 6.3% annually. Retail sales rose 2.8% annually, also above expectations.
    
3. Turbulence breaks market patterns: As markets retreated this month, some patterns seen earlier this year faded and the market experienced sharp rotations, especially in sectors subject to AI disruption concerns. One that stands out is software-as-a-service, or SaaS stocks, after the so-called "Di-SaaS-ter" that afflicted them prior to the war. Software rebounded in March, though it's unclear if there's any fundamental basis. Instead, the comeback might reflect short attention span money that's "just flying around the market, not just by retail traders, but institutions like commodity trading advisors, some of the systematic hedge fund community, and the long and short hedge fund community," said my colleague Sonders. "And you just get these rapid-fire shifts and rotations that happen as short-term positioning is adjusted."

• Airline and cruise line stocks surged early today after news the U.S. is postponing strikes on Iran's power plants. Delta Air Lines (DAL) rose nearly 4% and Carnival (CCL) climbed 3.5%.
   
• Energy stocks including Exxon Mobil (XOM) and Chevron (CVX) inched lower. Trump said the postponement of threatened strikes on Iran's energy infrastructure will last five days.
   
• Gold (/GC) fell again this morning, down another 4% to below $4,400 per ounce after its worst week in 43 years. The precious metal lost steam after last week's Federal Reserve meeting sent a hawkish tone that reversed hopes for rate cuts this year. Silver (/SI) dropped nearly 3% to one-month lows, but copper prices inched up. Mining firm stocks including Freeport-McMoRan (FCX) and Newmont (NEM) slipped.
   
• DraftKings (DKNG) popped nearly 7% early Monday as Citizens reiterated its market outperform rating and $38 target.
   
• MongoDB (MDB) climbed almost 4% following an upgrade from neutral to outperform by Mizuho, which said it sees a "compelling" share setup after the company's recent earnings report.
   
• The S&P 500 Index recorded its fourth straight losing week with a loss of nearly 2% and dipped beneath its November closing low of 6,538. It has closed below its 200-day moving average of 6,621 two days in a row—a bearish sign technically that could suggest more selling pressure ahead. Friday's close was the lowest since last September 8. The index is down about 5% year-to-date.
   
• Odds of a Fed rate cut this year fell from 95% a month ago to around 5% this morning, according to the CME FedWatch Tool. Futures trading now works in nearly 40% chances of at least one rate hike at some point in 2026.  
   
• Treasury yields are up sharply since the war began, in contrast to historic drops in yields when geopolitical volatility surges. The typical "flight to safety" that often lifts Treasuries hasn't occurred. Several Treasury auctions loom this week. Further demand weakness could drive yields even higher after the 10-year note yield spiked to 4.4% Friday, the highest since last July. The drawback of rate cut hopes, if it lasts, has potential to clip "dip buying" in stocks. A 2-year note auction tomorrow could be critical.
   
• The Russell 2000 had the worst day of any index Friday, dropping more than 2.5% as Treasury yields surged. Higher yields often hurt smaller companies, which tend to depend more on borrowing. The Nasdaq Composite approached correction territory intraday, Friday, too, down more than 9% from recent highs.
   
• The Relative Strength Index, or RSI, for the S&P 500 Index dipped below 30 at one point Friday, historically an indication of oversold conditions and down from highs late last year above 70. This, along with recent poor investor sentiment readings, could be a contrarian indicator signaling possible improvement in coming days. However, market behavior during geopolitical storms can be unpredictable.

Traders' corner: Get the latest on volatility, key chart points, sentiment, and market breadth in Schwab's Weekly Trader's Outlook, which can help get active participants ready for the new week. In this week's installment, my colleague Peterson said that despite four straight weeks of losses, "I'm not sure that we've hit a capitulatory 'flush' in stocks yet."

The S&P 500 Equal Weight Index (SPXEW—candlesticks) is holding its own in a tough first quarter. It's down 1.64% year to date, a better performance than 5% declines for both the S&P 500 Index (SPX—purple line) and the Nasdaq-100^® Index (NDX—blue line). The SPXEW weighs all components of the index the same rather than by market capitalization, and reflects strength this year in some of the sectors less exposed to tech mega caps.