TLDR

  • The Fed convenes Wednesday and is anticipated to keep rates in the 3.5%–3.75% range, with attention focused on Powell’s press conference
  • Last week, oil prices surpassed $100 a barrel due to the war in Iran blocking the Strait of Hormuz
  • Micron releases earnings Wednesday following a more than fourfold increase in its stock price over the past year
  • FedEx, Dollar Tree, Alibaba, and multiple retailers are also reporting results this week
  • Goldman Sachs indicates that if the Strait remains blocked for 60 days, oil could average $93 per barrel in the fourth quarter

U.S. stocks declined for the third consecutive week, with the war in Iran driving oil prices to heights not witnessed since the 2022 energy crisis. The S&P 500 fell 1.6% for the week, the Dow Jones Industrial Average dropped 2%, and the Nasdaq Composite slid 1.3%.

E-Mini S&P 500 Mar 26 (ES=F)
E-Mini S&P 500 Mar 26 (ES=F)

Markets are now entering a busy week featuring a Federal Reserve decision, a flurry of earnings reports, and Nvidia’s annual developer conference.

The Federal Open Market Committee meets Wednesday to deliberate on interest rates. The current Fed funds rate ranges from 3.5% to 3.75%, and investors are nearly certain rates will remain unchanged.

Chair Jerome Powell will host a press conference after the decision, which may be more significant than the rate call itself.

Powell is likely to address internal divisions at the Fed: some members advocate for additional rate cuts due to a softening labor market, while others fear oil-fueled inflation could intensify.

This is projected to be Powell’s penultimate press conference, as his term as chair concludes in May.

Oil and the Strait of Hormuz

The war in Iran is now in its third week with no end in sight. The Strait of Hormuz, a 21-mile-wide waterway transporting approximately 14 million barrels of oil daily, remains closed.

Iran’s Revolutionary Guard Corps has stated it will not permit “a liter of oil” to traverse the Strait.

Oil briefly exceeded $100 per barrel last Sunday, the first time since Russia’s 2022 invasion of Ukraine. Prices retreated to the $80s but rose again following drone strikes on critical oil infrastructure and production cuts announced by Gulf states.

Goldman Sachs notes that a 60-day closure of the Strait could lead to a fourth-quarter average of $93 per barrel for Brent crude and $89 per barrel for U.S. West Texas Intermediate.

Source: Forex Factory

Wednesday also sees the release of the February Producer Price Index. January’s report revealed wholesale prices increased more than anticipated.

Micron and the Earnings Lineup

Micron Technology reports earnings Wednesday. The memory chip manufacturer’s stock has more than quadrupled in the past year, fueled by demand for AI hardware. In its previous quarter, Micron recorded a 60% year-over-year sales increase and exceeded analyst earnings expectations.

FedEx reports Thursday; its stock has gained nearly 25% this year. Investors closely monitor FedEx for insights into the broader economy from its shipping volumes.

Dollar Tree also reports and will provide a snapshot of U.S. consumer health; its last report noted shoppers were “stretched.”

Nuclear energy firm Oklo reports Tuesday. Earlier this year, it inked a deal with Meta to provide power for the company’s data centers.

Alibaba reports Thursday with plans to increase AI spending, while Chinese EV maker Xpeng releases results Friday.

Nvidia’s GTC 2026 conference begins Monday with a keynote address from CEO Jensen Huang.