Stocks Plunge Again With War Still Raging, Oil Up

Published as of: March 27, 2026, 9:15 a.m. ET

(Friday market open) The weekend approaches with war tensions mounting and investors shying from risk. Stocks hit nearly seven-month lows Thursday in the worst session since the war began and slid again early today as war raged without signs of a resolution. Brent crude climbed back above $110 per barrel and U.S. Treasury yields rallied to nearly nine-month highs on inflation fears. Major indexes are on pace for the fifth straight lower week, a streak last achieved during the miserable market year of 2022.

Next week is another light one for earnings, aside from consumer bellwether Nike (NKE) late Tuesday. That's also the end of the quarter, meaning "window dressing" could be an element Monday and Tuesday. That's when fund managers shift positions to add better-performing names and drop worse ones before the quarter ends and sometimes leads to choppy trading. There's also a series of labor market readings culminating in the April 3 nonfarm payrolls report for March.

On Thursday, major indexes plunged and the Nasdaq Composite entered correction territory down 10% from recent highs as chip stocks and Meta Platforms (META) came under intense pressure. Volume was low, suggesting weak conviction, and the chip side of the market could be worth watching for clues to overall sentiment. Late Thursday, President Trump extended his deadline of a threat against Iranian energy facilities to April 6. Markets initially welcomed the news, but quickly returned to their bearish ways, raising questions about how much credence Wall Street now gives such posts. Headlines of more U.S. troops heading to the region could keep caution a theme going into the weekend.

1. Dovish to hawkish stance draws second looks: For months, the futures market anticipated two to three Federal Reserve rate cuts this year despite the Fed projecting only one in its December "dot plot" of rates. The Fed's updated dot plot released this month still projects a cut, but, as of early today, odds of rates ending the year below the current target range of 3.5% to 3.75% were zero, according to the CME FedWatch Tool, with slight odds the next move could be a hike. The quick reversal drew scrutiny amid ideas that market participants might have overshot, this time too hawkishly. This reflects concern that the rising cost of oil might trigger a slowdown, forcing the Fed into rate cuts later this year despite the inflationary impact of gas and diesel. "The Fed's in a pickle with the dual mandate in conflict," said Liz Ann Sonders, chief investment strategist at the Schwab Center for Financial Research (SCFR), referring to the Fed's dual mandate of maximum employment and stable prices. A much longer shutdown of the Strait of Hormuz could end up causing "demand destruction," Sonders added. The Fed is already concerned about lack of job creation over the last year, and a drop in energy demand would potentially add to economic woes. This could mean the market is getting a little ahead of itself completely pricing out rate cuts.
    
2. Yields up, Treasury demand down as war spending debated: Soft demand at Treasury auctions all this month suggests participants want higher yields to take on U.S. debt, possibly due to anticipated war costs that threaten to raise a U.S. debt approaching $40 trillion. This has a real-world impact, with 30-year mortgage rates recently touching 6.5%, up from 6% a month ago, and weekly mortgage applications falling 10% last week. U.S. 10-year Treasury note yields continue their upward path, approaching 4.5% this morning and weighing on equities. "Last week, the Pentagon asked the White House to submit an emergency request to Congress for $200 billion in supplemental funding for the cost of the war, a number that raised a lot of eyebrows in a Washington that's used to big spending numbers," said Michael Townsend, managing director of legislative and regulatory affairs, Schwab, in his latest Washington Watch podcast. The debate on supplemental war funding will likely be pushed back to April. In other news, Washington found a way to pay Transportation Security Administration (TSA) agents late Thursday, hopefully meaning shorter airport lines for anyone traveling this weekend on spring break.
    
3. Turbulence worse under surface: Though major indexes haven't fallen out of bed since the war began, that disguises bigger moves just below the surface. The maximum drawdown for the S&P 500 Index has been 7% from recent highs, but the average member has seen a 17% drawdown. It's even more dramatic in the Nasdaq Composite, where the average member has seen a 31% drawdown. "In other words, corrections have been occurring via a process of rotation and churn versus indexes falling as monoliths," my colleague Sonders said. From a technical standpoint, the S&P 500 remains in a downtrend, well below its 200-day moving average of 6,633. Any close today below 6,506 would make this the fifth straight week of losses for the index, the longest losing stretch since Russia's invasion of Ukraine. Technical support isn't evident much below this week's lows until the 6,200 level. The Cboe Volatility Index (VIX) is approaching 30 and investors are paying up for hedges with a strong bias toward puts. Risk sentiment could stabilize on credible ceasefire steps and clearer signals that transit through the strait is normalizing.

• Cybersecurity stocks including CrowdStrike (CRWD) and Palo Alto Networks (PANW) were two of the worst overnight S&P 500 performers, falling 6% and 4%, respectively, after Fortune reported that Anthropic accidentally leaked details of a new AI model that poses "unprecedented security risks."
   
• Gold (/GC) rebounded this morning but is on pace to fall this week and remains near three-month lows below $4,500. One possible reason for recent gold softness could be a drop in central bank purchases.
   
• Bitcoin futures (/BTC) plunged almost 3% early today, possibly a sign of risk-off sentiment. This made crypto-related stocks some of the worst overnight performers.
   
• Shares of memory chip firms fell sharply Thursday after Alphabet's Google (GOOGL) introduced an AI model that it said could reduce the amount of memory needed to run large language models, CNBC reported. Micron (MU) shares are down six straight days, and shares of firms like SanDisk (SNDK), Western Digital (WDC), and Seagate Technology (STX) all fell 1.5% or more early today.
   
• The PHLX Semiconductor Index (SOX) plunged more than 4% yesterday, with chip leader Nvidia (NVDA) down 4% to a three-month low. On the whole, tech valuations have fallen dramatically, with the tech sector's forward price-to-earnings ratio (P/E) now below where it was after tariff "liberation day" and the lowest in three years at 20.2. That's down from 31.7 in just five months.
   
• Tripadvisor (TRIP) climbed nearly 5% early today after getting an upgrade from Bank of America.
   
• AstraZeneca (AZN) rose 4% early Friday, getting a lift from positive trial results from a drug that treats chronic obstructive pulmonary disease, CNBC reported.
   
• Market breadth, often a sign of health when it rises, has deteriorated mightily. None of the major indexes have even 50% of stocks above their 200-day moving averages. Though yesterday was the worst day for the S&P 500 Index since January 20, the advance-decline spread wasn't that severe, noted Kevin Gordon, head of macro research and strategy at SCFR.
   
• Shares of Meta Platforms (META) and Alphabet both slid Thursday, with a dramatic drop of almost 8% for Meta after a Los Angeles jury found Alphabet's Google unit and Meta liable in a landmark social media addiction lawsuit whose outcome could influence thousands of similar cases against the tech companies, Reuters reported.

Seeking guidance: With earnings season approaching, now is a good time to read Schwab's new look at company guidance, which explains why companies provide it and how to consider it in balance with all the other information reported on earnings days.

Micro bitcoin and ether futures primer: Traders who are unsure about trading a full-size crypto futures contract can gain bite-size crypto exposure through micro cryptocurrency products at the CME Group. Learn more about these in Schwab's latest look at crypto.

The S&P 500 Index (SPX—candlesticks) closed yesterday near a long-term support area of 6,475 (top red line) but may have a long drop to the next major area of support near 6,174 (lower red line), which corresponds with a 38.2% retracement of the recent rally, a key Fibonacci level. The index remains in a downtrend below its 200-day moving average (blue line).

Check out the investors' calendar for a summary of the top economic events and earnings reports on tap this week.

March 30: No major earnings or data expected.
March 31: March Consumer Confidence and expected earnings from McCormick (MKC) and Nike (NKE).
April 1: March ISM Manufacturing PMI^®, March ADP employment, February construction spendings, and expected earnings from Conagra (CAG).
April 2: February factory orders.
April 3: March nonfarm payrolls, March unemployment, markets closed for Good Friday.