The Markets (as of market close March 20, 2026)
Stocks declined last week as rising energy prices, escalating Middle East tensions, and renewed stagflation concerns weighed heavily on investor sentiment. The S&P 500 fell to a four-month low, while weakness in technology stocks dragged the NASDAQ lower. A stronger-than-expected Producer Price Index report and hawkish Federal Reserve commentary pushed Treasury yields higher, with the 10-year reaching its highest level since July 2025. Higher rates continued to pressure growth-oriented sectors. Energy was the only sector to post gains, while materials, utilities, and consumer staples lagged. Gold prices fell to a two-month low as expectations for higher-for-longer interest rates intensified.
Last Week’s Economic News
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The Federal Reserve held rates steady at 3.50%–3.75%, citing solid economic activity but low job gains and persistent inflation, while emphasizing a data-dependent approach going forward.
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Industrial production rose in February, with gains in manufacturing and mining offset by a decline in utilities output.
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Producer prices increased in February, with a 3.4% year-over-year gain, marking the fastest annual pace since early 2025
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Core producer prices rose, extending a streak of monthly increases and signaling persistent underlying inflation pressures.
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New home sales declined sharply, falling 17.6% in January, with rising inventory and lower home prices indicating cooling housing demand.
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Weekly jobless claims fell to 205,000, suggesting continued labor market stability despite broader economic concerns.
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Gasoline prices surged to $3.720 per gallon, reflecting elevated crude oil prices and rising geopolitical tensions.
Eye on the Week Ahead
The Federal Open Market Committee meets this week as policymakers assess rising energy prices, persistent inflation pressures, slowing economic growth, and evolving geopolitical risks before determining whether to adjust interest rates.
Have a nice week!
Sincerely,
Robert G. Carpenter