Strait Talk: Stocks Up on Slight Dip in Oil Prices

Published as of: March 16, 2026, 9:12 a.m. ET

(Monday market open) After a third straight weekly drop pushed the S&P 500 Index to nearly four-month lows, investors face several central bank meetings, an Nvidia (NVDA) conference, and earnings from chip giant Micron (MU) in coming days. So naturally, Wall Street focused this morning on crude oil prices and the war in the Middle East. Stocks edged up early as crude slipped, though investors might want to remember that recent rallies often faded.

Nvidia's (NVDA) GPU Tech Conference (GTC) features a speech by CEO Jensen Huang at 2 p.m. ET today that might momentarily distract from the drumbeat of war news. "Huang will likely deliver several AI-related headlines, which could have an impact on tech stocks," said Nathan Peterson, director of derivatives research and strategy at the Schwab Center for Financial Research (SCFR), in his Weekly Trader's Outlook. Looking further out, the Federal Reserve is expected to keep rates unchanged Wednesday afternoon while delivering updated economic projections and a new "dot plot" of possible rate paths.

On Friday, Wall Street suffered sharp losses on rising crude, with tech stocks under pressure thanks to chip weakness. Energy and utilities were the only green sectors last week. Technically, the Nasdaq Composite suffered a blow Friday, closing beneath its 200-day moving average for the first time since May. The S&P 500 Index hovers just above its own of 6,600. Over the weekend, the U.S. asked for international help keeping the Strait of Hormuz open and attacked Iranian installations on Kharg Island. Hopes that a multi-country coalition could come together and help oil flow again appeared to help sentiment this morning.

1. Iran update: The war in Iran has evolved from a geopolitical event to a global energy supply shock. The disruption to energy and commodity supplies is likely to have an increasingly negative impact on economic and financial conditions the longer it goes on. "Even if military activity ends soon, the impacts to growth, inflation, and commodity prices could linger," wrote Michelle Gibley, director of international equity research and Chris Ferrarone, head of equity research and strategy, both of SCFR, in their latest look at potential economic impacts from the conflict. And the longer energy and commodity supplies remain disrupted, the greater the potential economic damage. Asia appears most vulnerable, with Europe also facing meaningful exposure. In this environment, financial conditions can remain tighter than normal and risk aversion can stay higher for longer, especially for international markets.
    
2. Crosswinds as central bank meetings loom: Policymakers at major central banks this week must consider energy-driven inflation gains, while the Fed also might be concerned about a slower U.S. jobs market. Rising crude prices can lift near-term inflation, though policymakers tend to look beyond volatile energy and its impact on consumer and wholesale prices. That means it might take months of high energy prices seeping into other parts of the economy to make the Fed factor gas prices into its long-term inflation outlook. That scenario, however, would also likely raise recession odds and hurt jobs growth, putting the Fed in even more of a pickle. The Fed's announcement at 2 p.m. ET Wednesday includes policymakers' "dot plot" of the rate path ahead along with updates on economic expectations. Projections likely take center stage with no rate cut seen, but the question is whether Fed officials see any cuts at all this year after the last dot plot averaged one. Market expectations for a June rate cut are down to 23% from 56%, according to Bloomberg. The September Fed meeting, which had a theoretical 100% probability of a cut last week, has essentially been cut in half to 54%.
    
3. Shortness of breadth: From a market breadth perspective, the last two weeks have been devastating. By late Friday, less than 32% of S&P 500 stocks traded at or above their 50-day moving averages, far below the 59% that had been the average over the last six months and down from 65% earlier this month. The pattern is also lower in the Nasdaq as stocks fell across the spectrum amid war and oil concerns and reached the lowest level since 2024 on Friday. Typically, broader participation suggests healthy investor sentiment and supportive technicals. Breadth had been healthy for months before the war, reflecting a move by investors into sectors beyond the mega caps.

• Meta (META) climbed 2.9% in early trading on news its workforce could shrink 20% as part of an effort to offset heavy AI spending and as the company grows more efficient due to AI, Reuters reported over the weekend. There's been no date set yet for job cuts at the company, which employed 79,000 people as of December 31.
   
• Nebius Group (NBIS) rose 14% early today after it announced a new five-year AI infrastructure supply agreement with Meta to provide $12 billion of dedicated capacity across multiple locations, including one of the first large-scale deployments of the Nvidia Vera Rubin platform.
   
• Nvidia climbed 1.3% ahead of its GTC conference. The company is expected to show multiple hardware innovations, potentially including a new chip for inference, the process of generating results from AI models, Barron's reported. Investors will also want to learn about how the supply outlook for critical chip components might be affected by war in the Middle East, and the war's impact on power costs. Additionally, Morgan Stanley reiterated its overweight rating on shares.
   
• Memory chip names bucked a mostly lower day for tech on Friday, lifted by a 7% rise for SanDisk (SNDK) and a nearly 5% gain for Micron (MU). News appeared thin so this may be positioning ahead of Micron's earnings this Wednesday. Western Digital (WDC) also moved higher. Micron announced plans to build a new chip facility in Taiwan, Reuters reported.
   
• Other chip stocks were also up early today, including a 3.7% climb for Intel (INTC) and nearly 1% for Advanced Micro Devices (AMD). The move appeared related to a Reuters report that the U.S. Commerce Department has withdrawn a draft rule that would have revised AI chip export controls. It's another shift in the administration's approach as it reconsiders how to balance export restrictions with efforts to maintain U.S. AI leadership.
   
• Major Chinese indexes rose more than 1% Monday following positive economic data including a larger-than-expected rise in February industrial production of 6.3% annually. Retail sales rose 2.8% annually, also above expectations.
   
• Bitcoin (/BTC) jumped 3.7% this morning, a possible sign of risk-on sentiment, and shares of crypto-related companies also climbed.
   
• The 10-year Treasury note yield climbed another two basis points Friday to just under 4.3%, up 16 basis points for the week. Rising oil prices pushed up yields most of last week, with inflation fears on the front burner.
   
• Last week, the DJIA fell 0.26%, the S&P 500 declined 1.6%, and the Nasdaq fell 1.4%.

Fresh perspective: In Schwab's newest market outlook, our experts discussed their big-picture views. "Iran-related geopolitical risk has boosted energy leadership and volatility, while elevated stock- and sector-level swings reinforce the importance of diversification, rebalancing, and fundamentals-driven, active decision-making," they noted.

New to Investing? Check our latest Financial Decoder episode, where we shared seven good ideas for new investors. Even though it's oriented toward beginners, experts might find it useful as a refresher on long-term investing fundamentals.

Sector views expanded: In Schwab's updated Sector Views, our six-12 month outlook for stock sectors, we expanded our sector ratings to five: Most Favored, More Favored, Neutral, Less Favored, and Least Favored. Industrials should benefit from increased defense spending and capital spending related to the AI infrastructure buildout, which also supported materials. Consumer discretionary fundamentals have weakened recently with softer revenue and free-cash-flow trends relative to other sectors.
 

The four charts above (from top-to-bottom) of the S&P 500 Index (SPX), Nasdaq-100^® Index (NDX), Dow Jones Industrial Average ($DJI), and Russell 2000^® Index (RUT), show that each have seen their 20-day moving averages (blue lines) dip below their 50-day moving averages (red lines). Technicians view this sort of move as a sign of chart weakness that could help keep stocks under pressure.