Morning Roundup

By Mark Masterson on March 31, 2026

Good morning,

Below are the news items moving markets today:

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Executive Summary

On to Tuesday……

These are the remaining key events scheduled for this Easter holiday shortened trading week:

• March Consumer Confidence data – Tuesday
• February JOLTS Job Openings data – Tuesday
• March ADP Nonfarm Employment data – Wednesday
• March Retail Sales data – Wednesday
• March Jobs Report – Friday

Futures jump again overnight on the latest hint that Trump is searching for some kind of off-ramp from the war in Iran….

President Trump is willing to end the Iran War even if the Strait of Hormuz remains closed, per WSJ.

Details include:

• Trump and his aides assessed that a mission to reopen Hormuz would push the conflict beyond his timeline 4-6 weeks
• Trump believes the US should achieve its main goals of destroying Iran’s navy and missile stockpiles
• Trump thinks he can wind down current hostilities while pressuring Iran diplomatically to resume the “free flow of trade”
• If that fails, Washington would press allies in Europe and the Gulf to take the lead on reopening the Strait, US officials say

Fed Chairman Powell spoke yesterday. 

• Powell said he does not see a contagion unfolding from recent private credit developments, noting the space represents only a small portion of overall asset pool (Bloomberg).
• Powell acknowledged current labor market faces long-term structural challenges, but highlighted potential productivity gains from AI, describing himself as “very optimistic” on the U.S. economy over the medium and long term (CNBC).
• On inflation, Powell noted ongoing “tension” between the Fed’s dual objectives, though said inflation expectations remain stable; characterized tariff-driven price increases as largely one-time, contributing ~0.5-1.0% to inflation.
• Regarding Iran conflict, Powell maintained a cautious “wait-and-see” stance, acknowledging that Fed tools have little impact on supply shocks (Reuters).

The final day of March – and investors are glad to see the month go. 

It was a difficult month for most capital markets. 

In March:

• US dollar set for best month since 2024
• Bond yields poised for largest monthly rise since 2024
• S&P poised for biggest monthly drop since 2022
• Brent crude set for its biggest ever monthly gain
• Average US gas prices are over $4 again for the first time since 2022

The Iran war was the obvious culprit….

Since the start of the Iran war…

• Jet Fuel: +78%
• European Natural Gas: +72%
• Heating Oil: +68%
• Brent Crude Oil: +55%
• $VIX: +54%
• WTI Crude Oil: +54%
• Urea: +48%
• Sulfur: +48%
• Gasoline: +47%
• Diesel: +44%
• Fertilizer: +29%
• Coal: +22%
• Palm Oil: +14%
• Rice: +9%
• Iron Ore: +7%
• S&P 500: -8%

Bottom line:

Energy prices matter to global economic growth.  It’s clear we need a pause/ceasefire to reverse some of the damage to energy prices in March.

As Strategas said this morning – “It takes two to TACO.” 

In the past week, I highlighted many signs the market (many assets, not just stocks) are quite oversold and looking for a positive catalyst to release the selling pressure. 

Markets do not necessarily need to be better – just “less bad.”

Clearly a meaningful ceasefire and path to peace in the war/conflict with Iran is the most likely candidate.

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Articles of Interest:

• Iran conflict:
  • Trump willing to end Iran conflict without reopening Strait of Hormuz (link),
  • Iranian leadership fractured, leaving negotiators in dark about what government is willing to concede in talks (NY Times)
  • Gulf allies urge Trump to intensify war on Iran until leadership changes (AP)
  • US strikes large Iranian ammunition depot in Isfahan with bunker buster bombs (Telegraph)
  • Thousands of US 82nd Airborne troops arrive in Middle East amid Iran war (Reuters )
• Energy/Commodities:
  • Iran strikes Kuwaiti oil tanker stationed in Dubai (Bloomberg, Reuters)
  • US gasoline prices surge above $4 per gallon for first time in over three years (CNBC )
  • Two Chinese container ships successfully cross Strait of Hormuz (Reuters )
  • Massive US LNG plant run by QatarEnergy and ExxonMobil begins production, first shipment expected in Q2 (FT)
  • China set to resume imports of US energy as it looks to diversify supply (Nikkei)
  • Shipping analysts question Trump’s claim Iran allowed 20 Pakistan-flagged ships to transit through Strait of Hormuz (FT)
  • EU urges oil and gas demand cuts in transport amid Iran war energy crisis (Politico)
• Markets:

• Iran war triggers worst quarter for US stocks in nearly four years (link)
• Global government bonds suffer biggest monthly fall in years on Iran war (Reuters)
• Middle East oil producers have cut US Treasury holdings since Iran war began (link)
• Japan labels recent yen falls as speculative amid Iran war oil shock (Reuters)

• Washington:
  • Trump administration to unveil $1.5T defense budget on 3-Apr (Bloomberg)
  • More states moving ahead with AI regulation despite Trump’s call for federal legislation (NY Times)
• Geopolitics:
  • Rubio criticizes lack of NATO support in war, says US may reassess relationship (Bloomberg)
  • Italy denies US military aircraft permission to land at Sicily base citing improper procedures (Bloomberg)

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Charts of the day:

More signs of an oversold market emerging…..

Strategas highlights how we are near the zone where markets tend to bounce.

We may be there now, but typically 2-5% lower marks the lows.

Strategas 3 31 26

Selling has been intense this past month…..

• The third largest selling in 10 years
• On a trailing 6-week basis, the recent US net selling by hedge funds is the third largest over the past decade and approaching the levels seen in Apr-May ’20 during Covid, and (to a lesser extent) into Liberation Day.
• Some signs of capitulation are starting to emerge.

Source: GS Prime

Goldman Sachs 3 31 26

Right now it’s all about Iran.  However, mid-term years are almost always more volatile.

The S&P is currently down 8.5%.

Average midterm drawdown is 16.1%.

I’d expect more volatility as we move through the year.

However – once we get through the election window – markets typically rally strongly.

Mike Zaccardi 3 31 26

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Quote of the day:

Kites fly highest against the wind, not with it

Winston Churchill