NEW YORK (AP) — Financial markets were turbulent through the first two months of this year. Then the war began.
price of barrel of brent crude oil Gasoline prices are also rising, with the price exceeding $100 for the first time since the summer of 2022. After that, the price of crude oil remained roughly between $60 and $70.
The biggest concern for global stock markets in early 2026 is artificial intelligence – Are some companies spending too much on technology and whether it will make others obsolete? Investors are likely forgetting concerns about President Donald Trump’s spat with the European Union over his proposal for the United States to occupy Greenland. Investor attention is now squarely on how long the Iran war will last, how high inflation will jump, and what that means for the economy. It is common for indices such as the S&P 500 to fluctuate significantly during the day.
Patrick McKeon (center) works on the floor of the New York Stock Exchange on Tuesday, March 31, 2026, in New York. (AP Photo/Seth Wenig)
Uncertainty caused by war Complicating the Federal Reserve’s interest rate decisionshas kept interest rates unchanged this year after lowering them three times late last year. Further rate cuts would support the economy, but could also put upward pressure on inflation. Keeping them high helps fight inflation, but it also puts pressure on economic growth.
Here are the market movements in March:
oil
Since the start of the Iran war, oil prices have been a driving force behind the sharp swings in the U.S. stock market. Brent crude, the benchmark for about three-quarters of the world’s oil, soared from about $70 a barrel to as high as $119 at times. Investors are oscillating between hopes that the war will end fairly quickly and worries that a prolonged conflict could lock Persian Gulf oil and natural gas out of global markets, sparking rampant inflation.
As February came to a close, drivers in many parts of the United States were paying less than $3 for a gallon of gas. As of Tuesday, The national average was over $4 First time since 2022.
The rise in prices for diesel, which is used by many cargo and delivery trucks, has been more pronounced, with an average price of $5.45 per gallon now, up from about $3.76 per gallon before the war started, according to AAA.
“Americans spend hundreds of millions of dollars on gasoline every day,” said Patrick de Haan, head of petroleum analysis at fuel tracking service GasBuddy.
stock
The US stock market entered 2026 after three consecutive years of significant gains. Many international markets surpassed this in 2025 after falling behind for several years.
It fell nearly 4.6%, the S&P 500 index’s worst quarterly performance since 2022. The tech-heavy Nasdaq Composite Index closed Thursday down more than 10% from its record high set in October. This is a drop so large that professional investors would call it a “correction.”
Not surprisingly, energy stocks were among the S&P 500’s best performing stocks for the month and quarter. ExxonMobil posted the biggest quarterly increase, according to FactSet. Other strong performers include Occidental Petroleum and Valero Energy.
Perhaps it’s fitting that the stock market ended the month with another big move. This time, prices rose on renewed hopes that the war might end quickly. However, such hopes had built up many times before during the war, and then quickly disappeared.
bond
Typically, when world events threaten the economy, investors flock to bonds and other safe-haven assets. But in this case, the potential for a spike in inflation due to soaring oil prices caused bond prices to plummet and yields to rise accordingly.
The yield on the 10-year U.S. Treasury was just 3.97% in late February, rose to 4.44%, and has since receded slightly. That surge helped. push up mortgage interest rates Other loans for U.S. households and businesses. Traders now view the Fed as highly unlikely to cut rates even once this year.
Uncertainty reigns
It’s difficult to predict what will happen next. President Donald Trump is Wavering between stories about the end of the war And there are threats to escalate it and target Iran’s energy infrastructure. Iran has downplayed President Trump’s claims about progress in diplomatic negotiations.
Iran maintains a chokehold on the Strait of Hormuz, a waterway leading from the Persian Gulf through which one-fifth of the world’s oil is transported in peacetime. Analysts expect that as long as this situation persists, oil and stock markets will continue to experience increased volatility.
