Stock futures slipped Sunday night as Wall Street braced for another bruising week, with the Iran conflict entering its fourth week and oil prices threatening to break $100 per barrel. Dow futures dropped 273 points (0.6%), S&P 500 futures shed 0.6%, and Nasdaq-100 futures pulled back 0.8%.
The sell signal came after President Trump threatened strikes on Iranian power plants if the Strait of Hormuz remains blocked. Tehran responded with threats against U.S.-allied energy infrastructure in the Gulf, sending West Texas Intermediate crude up 1.4% to $99.42 and Brent to $113.08 in overnight trading.
Four Straight Weekly Losses 🔗
Friday’s close capped the worst four-week stretch for equities since the tariff shock of early 2026. The Dow shed 443 points (0.96%) to 45,577, the S&P 500 fell 1.51% to 6,506, and the Nasdaq dropped 2.01% to 21,647. The small-cap Russell 2000 slid into correction territory, down more than 10% from its recent high.
| Index | Close (Mar 20) | Change |
|---|---|---|
| Dow Jones | 45,577.47 | -443.96 (-0.96%) |
| S&P 500 | 6,506.48 | -1.51% |
| Nasdaq Composite | 21,647.61 | -2.01% |
| WTI Crude | $98.32/bbl | +2.27% |
| Brent Crude | $112.19/bbl | +3.26% |
What’s Driving the Selloff 🔗
Oil is the trigger. Crude prices spiked after Iraq declared force majeure on all foreign-operated oilfields Friday, and drone strikes hit two refineries in Kuwait. Brent settled at $112.19 — levels not seen since the 2022 Russia-Ukraine shock. Every $10 increase in oil prices adds roughly 0.3 percentage points to CPI inflation, which was already running hot: the producer price index rose 0.7% in February, with core PPI up 0.5%.
The Fed is stuck. The Federal Reserve held rates at 3.5%–3.75% last week, caught between rising inflation from energy costs and weakening economic growth from geopolitical uncertainty. Rate cuts that seemed likely earlier in the quarter are now off the table — Fed Chair Powell signaled “patience” until the oil shock passes.
Tech Stocks Under Pressure 🔗
The Magnificent Seven took the hardest hits last week. Nvidia dropped 3.2% on supply chain fears (chip manufacturing relies on Middle East shipping lanes). Apple fell 2.8% as consumer spending forecasts dimmed. Microsoft held up relatively better, down 1.4%, supported by its $625 billion backlog of committed Azure contracts.
Meta dropped 2.9% as advertising budgets face pressure from rising input costs. Tesla fell 3.7%, the worst of the group, as higher gas prices paradoxically hurt EV sales — consumers delay big purchases during economic uncertainty regardless of fuel type.
Alphabet lost 2.1%, though Google Cloud continues to benefit from enterprises accelerating AI workloads. The broader AI stock trade has cooled significantly, with the sector down 8% from its February highs.
What to Watch This Week 🔗
Markets will be driven by three catalysts: any diplomatic progress on the Iran conflict, Thursday’s GDP revision for Q4 2025, and Friday’s PCE inflation data (the Fed’s preferred gauge). If core PCE comes in above 3%, expect another leg down in equities.
For investors, the playbook is straightforward: defense stocks and energy names continue to outperform, while growth and tech face headwinds until oil stabilizes. Dollar-cost averaging into quality names like Microsoft and Alphabet at these depressed levels has historically rewarded patient investors within 6–12 months of geopolitical selloffs.