Markets Overview

Stocks are navigating a brutal cocktail of slowing growth and sticky inflation, with the S&P 500 under pressure from the Iran conflict, surging energy costs, and deteriorating economic data. Gas prices have surged 17% since the war began, crude oil prices continue to climb, and the broader market tone is decidedly risk-off. Apple (AAPL) took another leg down, falling 2% in a session where mega-cap tech broadly sold off — Microsoft (MSFT) is now down roughly 18% year-to-date and 29% off its 52-week high of $555.45. A MarketWatch portfolio of heavily-shorted "pariah" stocks is notably outperforming the S&P in 2026, a classic sign of defensive positioning and market dislocation. Futures ticked higher overnight ahead of fresh inflation data, but conviction is thin.

Earnings Reports

Microsoft (MSFT) continues to bleed after a frustrating start to 2026, with the stock down ~18% YTD as investors reassess growth expectations despite its AI cloud push. One longtime bull publicly changed his mind on the stock, citing valuation concerns in a deteriorating macro backdrop.

MercadoLibre (MELI) plunged after Q4 earnings, now down 12% YTD, as the Latin American e-commerce giant disappointed despite years of market-beating performance. The sell-off is raising buy-the-dip debates among growth investors.

Amazon (AMZN) saw another post-earnings drop, extending its slide as the market punishes even slight misses in this environment. Retail growth bulls are eyeing the pullback as an entry point.

Microvast (MVST) reports Monday after hours — the market is pricing in distress and potential dilution from an active at-the-market offering, making it a high-stakes binary event. Oshkosh (OSK) is linked to the same catalyst.

Small-cap materials stocks are getting a post-earnings-season reassessment, with quant ratings highlighting pockets of relative value in an otherwise beaten-down segment.

Fed & Economic Data

The macro picture darkened considerably: Q4 2025 GDP was revised down to just 0.7% growth, confirming the economy stumbled into year-end. January core PCE — the Fed's preferred inflation gauge — came in at 3.1%, a sticky reading that effectively takes rate cuts off the table for now.

A federal judge blocked grand jury subpoenas targeting Fed Chair Jerome Powell, citing "essentially zero evidence" in the DOJ's criminal investigation. The DOJ plans to appeal, but for now, Powell's position appears secure — a small comfort for markets craving institutional stability.

Energy inflation is becoming the dominant macro story. Falling gasoline prices since mid-2022 had masked rising electricity and natural gas costs, but that tailwind is now gone. The Iran war has flipped energy from disinflationary force to inflationary accelerant, with the UK already facing recession risk as growth flatlines under the oil shock.

Hot Sectors

Energy remains the trade, with oil futures attracting both institutional and retail interest. The Trump administration has discussed directly trading oil futures to curb prices — a remarkable intervention signal. OSINT-driven traders are going long crude into the weekend on continued shipping disruptions in conflict zones.

Travel and leisure stocks are on watchlists as potential snapback plays if and when the Iran conflict de-escalates and oil retreats. Airlines and hotels look cheap, but timing the catalyst is the challenge.

Nuclear energy is getting a second look as the oil crisis underscores energy security concerns. Oklo (OKLO), trading around $60, is down 18% YTD but bulls argue its long-term thesis strengthens with every barrel above $90.

AI/Tech spending remains structurally strong — Gartner forecasts global IT spending will hit $6.15 trillion in 2026, up 10.8% over 2025 — but the stocks are de-rating as multiple compression meets macro headwinds.

Stock News

Nvidia (NVDA) landed a deal worth over $100 billion, reinforcing its 92% market share in data center computing hardware. The AI chip titan remains the infrastructure backbone of the AI buildout, though the stock's massive run (up 12.5x since early 2023) has investors debating how much is priced in.

Coinbase (COIN) surged more than 25% in the past month on renewed crypto momentum, with bulls arguing the exchange's brand dominance and regulatory positioning justify further upside.

Rivian (RIVN) is generating buzz ahead of its R2 launch — the company's first sub-$50,000 vehicle — which bulls see as a potential inflection point for volume and margins.

USA Rare Earth (USAR) is attracting speculative interest after a government agreement, though the risk profile remains elevated for this early-stage play.

The Trade Desk (TTD) is being called a screaming buy at current levels after a steep selloff, with bulls citing its dominant position in programmatic advertising at a rare discount.

Market Analysis

The word of the week is stagflation. GDP at 0.7% and core PCE at 3.1% is precisely the nightmare scenario the Fed hoped to avoid — growth too weak to ignore, inflation too hot to cut into. The central bank is effectively paralyzed, and markets are starting to price that in.

Three things to watch: (1) Monday's Microvast earnings as a barometer of small-cap distress tolerance; (2) any escalation or de-escalation signals from the Iran conflict, which is now the single biggest macro variable; and (3) whether the administration's trial balloon on trading oil futures materializes into actual market intervention — a move that could whipsaw crude in either direction.

The historical playbook says patient investors have always come out ahead after geopolitical shocks. That's true. But the current setup — a hot war, sticky inflation, fading growth, and a politically besieged Fed chair — is testing that thesis harder than anything since the 1970s. Position accordingly.