March Madness Hits: The Persian Gulf Continues To Rattle The Markets

Market Commentary – March 30, 2026

Geopolitical tensions in the Persian Gulf have pushed oil prices sharply higher, triggering another spike in market volatility and renewed inflation concerns.

The risk is that volatility will continue until more certainty over the Iran conflict can get priced into the markets. In the absence of such clarity, equity markets will most likely continue to correct. It is also worth noting that this pattern is not unusual in midterm election years, when the S&P 500 has historically experienced corrections in the 15%–20% range. Interest rates may also stay under pressure due to concerns about rising inflation and the possibility of the Federal Reserve (Fed) not cutting interest rates this year. In fact, in some corners, there’s speculation that the Fed could begin to raise rates. That is not a risk that we see at this time.

Despite the headlines, the U.S. economy is holding up well for now. Consumer spending remains solid, wage growth is healthy, and cooling rent increases are giving households, especially younger ones, extra breathing room. The near-term oil shock is real, but it has not yet derailed the underlying strength of the American consumer. However, all of this needs to be monitored, as sustained elevation in oil prices would increase the risk to both the economy and household demand.

Oil Is The Problem: Crude Oil Prices At Risk Of Rising

Concerns are rising that the conflict with Iran is not close to being resolved, and there’s growing speculation that it could escalate to include ground forces. Some are worried the U.S. will take Kharg Island, a continental island in the Persian Gulf, 19 miles off the mainland of Iran. Kharg Island is the export terminal for 90% of Iran’s oil shipments. This is keeping upward pressure on oil prices, with WTI crude holding resistance at $100. Should resistance break there, the next level is $115, and then further resistance would be the $145–$150 range. Historically, oil price spikes have tended to be short-lived – though they can still have a negative impact on markets in the interim. Looking longer term – once the conflict with Iran is resolved, oil looks to revert down toward $70-$60.

Holiday Weeks Tend To Have A Positive Bias

This week will keep investors focused on headlines from the Middle East, while important data looks to tell the story about the U.S. economy. With Passover and Easter this week, equity markets may carry a positive bias in what is a shortened holiday week (markets are closed on Good Friday). However, with the risk of escalating conflict in the Persian Gulf, investors should remain prepared for continued – at times episodic – volatility. We’ll also see a heavy slate of data, including JOLTS, ADP, retail sales, and ISM Manufacturing. The March employment report will be released on Friday, with markets closed, delaying any market response until Monday.

We wish all a peaceful and joyous holiday this week.