Stocks Sink, Yields Rise as Pessimism Over War Grows

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Sean Conlon and Sarah Min of CNBC report the Dow tumbles almost 800 points and enters correction, S&P 500 posts fifth straight losing week: 

The Dow Jones Industrial Average tumbled on Friday. It fell into correction territory, while Brent topped $110 after incidents in the Strait of Hormuz exacerbated investors’ energy supply concerns. President Donald Trump’s latest comments failed to encourage traders to scoop up shares.

The 30-stock Dow fell 793.47 points, or 1.73%, to close at 45,166.64. The S&P 500 lost 1.67% and ended the session at a seven-month low of 6,368.85. The Nasdaq Composite dropped 2.15% and settled at 20,948.36.

The broad market index notched its fifth straight weekly decline, dropping 2.1% in the period. The tech-heavy Nasdaq slid 3.2% week to date, while the blue-chip Dow retreated nearly 1% for the week.

Friday’s slip comes a day after the Nasdaq on Thursday fell into a correction and has moved almost 13% below its record set in October. The Dow moved into correction territory Friday on an intraday basis and ended the session down 10% from its closing high. The S&P 500 is down 8.7% from its closing record.

International Brent crude futures rose 4.22% to settle at $112.57 per barrel. U.S. West Texas Intermediate futures settled 5.46% higher to end at $99.64 a barrel after earlier hitting a session high of $100.04. It was the highest close since July 2022 for both benchmarks.

President Donald Trump extended a deadline to attack Iran’s energy infrastructure to April 6, a little over a week after the original deadline that was set to end Friday.

“As per Iranian Government request, please let this statement serve to represent that I am pausing the period of Energy Plant destruction,” Trump said in a Truth Social post. “Talks are ongoing and, despite erroneous statements to the contrary by the Fake News Media, and others, they are going very well. Thank you for your attention to this matter!”

The announcement is the latest signal the Trump administration is seeking an end to the U.S.-Iran war, a conflict that has resulted in surging oil prices that’s already hurting voters at the pump and could cost Republicans their seats in the midterm elections.

Uncertainty remains for investors, however, after Iran’s foreign minister reportedly told state media this week that Tehran has no intention of holding talks with the U.S., even if its leaders are reviewing an American proposal to end the war. On top of that, The Wall Street Journal reported, citing people familiar with the matter, that the Pentagon was considering sending another 10,000 troops to the Middle East.

The Strait of Hormuz is closed, Iran’s Islamic Revolutionary Guard Corps has said to the country’s state media, adding that movement through the key waterway will face a harsh response. Two Chinese ships were turned away from crossing the Strait early Friday, and a Thai-flagged cargo ship that had been hit in the waterway has run aground, Iran state media said.

Even with Trump’s deadline extension, investors are at the point where they want to see a resolution to the conflict actually come to fruition as opposed to hearing there’s “just maybe” a resolution, said Jay Hatfield, founder and CEO at Infrastructure Capital Advisors.

A resolution would be a boon for the stock market, which has tumbled since the U.S. and Israel attacked Iran’s energy infrastructure on Feb. 28. The three major averages have each fallen more than 7% month to date.

“The longer the Strait is closed, the worse the oil market is going to get,” Hatfield said. “The price will go down a lot, but there’s still going to be an inventory issue when the Strait reopens, so if it takes another month to reopen the Strait, oil might stay at like $80 for a while until we can rebuild stocks.”

“It’s bad if there’s no resolution, even if there is a path to resolution,” he continued.

Ines Ferré of Yahoo Finance also reports 'Magnificent 7' stocks wipe more than $850 billion in value as stock market sell-off hits AI winners hard:

Big Tech stocks were hammered this past week amid growing fears that rising inflation will keep interest rates higher for longer, while company-specific headwinds also weighed on the sector.

Collectively, the "Magnificent Seven" megacap stocks erased more than $850 billion in market value over the past week.

Meta (META) posted its worst week since October 2025, down more than 11% as Wall Street continued to grapple with the company’s loss in a landmark social media lawsuit earlier this week.

A jury found Meta and YouTube parent Google (GOOG, GOOGL) negligent for failing to protect young users on their platforms. Alphabet closed out the week down nearly 9%.

Microsoft (MSFT) ended the week 6.5% lower and is on track for its worst quarter since 2008 as software stocks have been particularly hard-hit.

Nvidia (NVDA) and Amazon (AMZN) fell roughly 3% for the week, while Tesla (TSLA) dropped nearly 2% over the five-day span.

Semiconductor stocks rebounded on Friday, but Sandisk (SNDK) and Micron Technology (MU) still ended the week in the red after sharp losses on Thursday.

The sell-off followed Alphabet Inc.’s release of new research outlining an algorithm designed to reduce AI memory usage, a development that rattled memory and broader semiconductor stocks.

Growth stocks were hit this week as bond yields rose amid expectations of higher inflation from surging oil prices, with investors anticipating the Federal Reserve will not be able to cut rates this year, as previously expected.

The only Magnificent Seven stock to end the week slightly higher was Apple (AAPL), following a report this week that it plans to open its Siri voice assistant to rival artificial intelligence services beyond its current partnership with OpenAI's (OPAI.PVT) ChatGPT. 

Myles Udland of Yahoo Finance also reports almost everything is going wrong for markets right now:

Stocks came into 2026 riding AI momentum, a more stable trade environment, and hopes for lower interest rates. The S&P 500 hit a record high in late January.

With two trading days left in the first quarter, the situation looks significantly more challenging.

The stock market looks broken, and it's far from clear as to how to fix it.

The S&P 500 (^GSPC) is down over 7% for the year. The Nasdaq (^IXIC) is in correction territory. The VIX (^VIX)— known as Wall Street's "fear index" — is trading at its highest level in a year, cresting the 30 mark.

Bond yields (^TNX) are soaring. Gold (GC=F) is off $500 from its record high reached in January. Bitcoin (BTC-USD) is languishing near $65,000. International stocks are underperforming US stocks once again. And markets have taken the possibility of rate cuts this year completely off the table; a rate hike in 2026 now seems more likely than a cut. 

Geopolitical headlines continue to overwhelm the news flow, but little this week seemed to arc toward either outcome on the energy front. And experts from inside the industry still think the risks from this conflict are being understated by markets.

For most of the past three years, stock market bulls have had multiple levers to pull to make their case — AI spending, earnings growth, and lower rates chief among them. In 2026, these catalysts have lost their juice.

And so many of the new developments crossing investors' radars — software getting replaced by AI agents, private credit funds gating redemptions — have simply added to a growing list of negatives.

There is a Warren Buffett quote for every market environment.

Many readers breezing through this gloomy summary of the market will be quick to pull one of his most famous — "Be greedy when others are fearful."

On Thursday, one of our favorite market voices — Truist Wealth chief investment officer Keith Lerner — did just about this, telling clients in a note that "measured cash deployment is warranted."

This is wealth adviser speak for: "Don't be afraid of the stock market."

Torsten Sløk, chief economist at Apollo, argued the market's reaction to the US-Iran conflict is an overreaction.

"Markets are overreacting to what will likely be a 4- to 6-week period of volatility, which will ultimately result in 50 years of stability in oil markets, supply chains and geopolitics," Sløk wrote.

In his view, inflation's rise will be temporary, rates will head lower, and the AI tailwind for the US economy won't be taken off course by this conflict.

An outline of what's happening in markets right now doesn't have much good to offer, but putting it all down in one place does offer a glimpse of what is needed to turn things around.

And the Sløk outline, let's call it, says that what risk assets — the stock market, bitcoin, etc. — need to see in order to work again is, at a minimum, stabilizing oil prices, preferably a decline in oil prices. Until then, we hold on. 

And Chris Clark of MoneyWise reports that Big Short investor Michael Burry says Trump's Iran war decisions are being driven by something other than foreign policy:

Gas prices and your retirement account shouldn’t feel like they’re reacting to the same headline, but lately they are. Renowned investor Michael Burry argues that the stock market isn’t just responding to the U.S. war with Iran but may also be shaping how quickly the U.S. tries to wrap it up.

Burry, the former hedge fund investor famous for predicting and profiting from the subprime mortgage crisis, argues President Donald Trump’s handling of the conflict in Iran — including reports that Trump was considering “winding down” the war — is being shaped by his allergy to market dips.

In a blunt Substack post (1), Burry called the stock market “Trump’s kryptonite,” saying his Iran strategy is “just get out before the market crashes too much. It’s a shame that Americans died for this.”

The reason Burry’s claim matters to everyday households is simple: when energy shocks mingle with persistent inflation and higher interest rates, consumer budgets tighten and retirement portfolios get shakier at the same time.

War and Wall Street as a pressure gauge

Consumers are feeling the familiar jolt of rising gas prices, one of the quickest ways a distant conflict can hit home. Threats to oil shipping tend to lift crude prices, which lifts gasoline costs, which in turn can keep inflation hotter for longer.

In a CNBC interview (2), Federal Reserve Bank of Chicago president Austan Goolsbee warned that, “What makes this a fraught but intense moment is nobody can tell us what is going to happen on the ground in the conflict in the Middle East, and how long that lasts.”

Consumer and investor anxiety is the backdrop for Burry’s provocative claim that market pain may be an invisible hand on foreign policy. If markets punish uncertainty, leaders who treat markets as a scoreboard may have an incentive to reduce that uncertainty, fast.

Reports about large, well-timed trades (3) placed just before Trump delayed or softened threatened strikes have intensified scrutiny of the conflict, but the White House has dismissed suggestions of coordination or market-driven war management.

There’s little denying that markets have been unusually jumpy. The S&P 500 first breached 7,000 on Jan. 28, a milestone widely tied to optimism around AI and expectations for easier monetary policy. By March 18, it closed at 6,624.70, its lowest close in nearly four months.

Oil has been even more dramatic since the start of the Iran conflict, rising and falling daily on the latest headlines about oil shipping lanes — including same-day swings that show how traders are repricing the conflict seemingly minute by minute.

Why Burry’s claim matters

Burry’s critique may resonate because it evokes how President Trump frequently talks about success.

In his February State of the Union speech (4), Trump boasted of dozens of stock market record highs and told Americans: “401(k)s and retirement accounts for the millions and the millions of Americans, they’re all gaining. Everybody is up, way up.” It’s an explicit connection between household well-being and market performance — suggesting it’s not a stretch to think market drops can become political pressure.

It’s also notable coming from Burry himself, a contrarian whose reputation rests on seeing incentives and market fragilities before others. Known as the “Big Short” investor, Burry made hundreds of millions of dollars for himself and investors by betting against the housing market ahead of the 2008 crisis (5).

For consumers, “war risk” often shows up as higher daily expenses and more volatile impacts on their savings. AAA put the national average gas price at $3.983 as of March 25 (6).

A Reuters/Ipsos poll (7) found 55% of Americans said their household finances had been hit at least “somewhat” by rising gas prices, and 87% expected prices to rise further over the next month because of the conflict.

Alright, another crazy week in markets and once again, it's all about the ongoing conflict in Iran.

Stocks popped on Monday following Trump's statement that he's delaying the bombing of power plants but resumed their downtrend for the remainder of the week.

Not surprisingly, Energy, Materials, Utilities and Staples were the best performing sectors this week while Communications Services, Information Technology, Financials and Consumer Discretionary posted the biggest losses: 

In terms of large-cap US stocks, here are the best and worst performing stocks this week (full list here):


 

Again, if you drill down the full list, you'll see a lot of energy and materials stocks popped and conversely, tech stocks like Micron, Sandisk, Meta, Reddit, etc got hit really hard.

Basically, everything that was hot last year and in the first two months of this year got clobbered this month. 

Many big tech names like Microsoft, Meta, and Oracle are down over 30% from their recent highs and the indexes are in correction mode but that can easily devolve into something worse if Trump decides to launch a full-blown ground invasion of Iran.

I doubt it will happen, however, as it's way too risky but with Trump, you never know, he says one thing and does another.

In this environment, investors are rightfully cautious. 

Not surprisingly, the headlines are all negative and for good reason, the situation is precarious, oil prices are rising, stocks are sinking, and yields are rising. 


 

And if that's not bad enough, a helium shortage could be the next Hormuz headache: 

As far as the Fed, the market is starting to think it might raise rates this year, but it's not going to happen because the fed funds rate is currently restrictive (above the inflation rate), so it wouldn't make sense for the Fed to raise rates in this uncertain environment.

So what happens next? I maintain that investors are tired of hearing Trump speak and post declarations, unless they see concrete steps that both sides are deescalating, this risk-off environment will continue.

But I do agree with Michael Burry, the stock market is  “Trump’s kryptonite,” and he must be panicking here and wondering how he can undo the damage.

Unfortunately, I'm not sure there's much he can do apart from pulling out completely from Iran.

Let me end it there; it was a long week for everyone.

Below, former Dallas Fed President Richard Fisher joins 'Closing Bell' to discuss the Federal Reserve's current position, the central bank's dual mandate and much more.

Next, The S&P and Nasdaq are on track for their 5th straight negative week. The Investment Committee debate how to trade stocks as the Iran War weighs heavily on the markets.

Third, 3Fourteen's Warren Pies joins 'Closing Bell Overtime' to talk the impact of the global energy shock on oil prices, equity markets, and global supply.

Fourth, earlier today, Secretary of State Marco Rubio takes reporters' questions in Paris, France.

Fifth, President Trump says he's working on a deal to end the Iran war, more troops are heading to the region. PBS's John Yang discussed the capabilities of the forces and how they could be used with Joel Rayburn and Frederic Wehrey. Rayburn is a retired Army colonel and is now at the Hudson Institute. Wehrey is a retired Air Force lieutenant colonel now at the Carnegie Endowment for International Peace.

Lasty, BlackRock CEO Larry Fink, who leads the world's largest asset manager, tells the BBC if Iran "remains a threat" and oil prices stay high it will have "profound implications" for the world economy.

Let's all hope this war ends sooner rather than later. 

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