Weekly Economic Update – 03/16/2026

The Week on Wall Street

Stocks logged a third-straight down week as investors digested the latest news out of the Middle East, navigated more volatility, and mulled the latest economic data.

The Standard & Poor’s 500 Index declined 1.60 percent, while the Nasdaq Composite Index lost 1.26 percent. The Dow Jones Industrial Average fell 1.99 percent. The MSCI EAFE Index, which tracks developed overseas stock markets, slid 2.28 percent.1,2

Middle East

Markets got a volatile start to the week, with stocks falling and oil prices rising as commercial maritime traffic heading out of the Persian Gulf through the Strait of Hormuz remained at a virtual standstill. But stocks rebounded late in the day after the White House said the conflict may end sooner than expected.³
 
Stocks dropped at Tuesday’s opening bell, but mostly recovered after word spread that a group of countries, including the U.S., were considering a coordinated release of strategic oil reserves to counter supply disruptions. Markets generally went sideways midweek as news that the Consumer Price Index (CPI) held steady last month buoyed spirits.^4,5
 
As the week progressed, all three major averages fell, and oil prices hit all-time closing highs. Investors grew increasingly concerned over the impact of oil supply disruptions on the broader global economy, with the Strait of Hormuz remaining a concern. Bond yields rose as investors believed a prolonged conflict would keep oil prices high, increasing the chance of higher inflation.⁶
 
Market sentiment continued to struggle as the week wrapped up, but declines slowed despite a downward revision to Q4 gross domestic product (GDP) growth.⁷

Stubborn Inflation

With all the updates on the Middle East conflict, it was easy to miss other news last week.
 
Wednesday’s report that the CPI remained unchanged in February over the prior 12 months was good news. But it was the last bit of inflation data before the conflict in the Middle East began. Friday’s Personal Consumption & Expenditures Index, the Fed’s preferred inflation measure, showed that consumer prices remained sticky in January. Investors largely took this report in stride because delayed reports tend to lose their impact with time.^8,9

Weekly Riddle

As I age, my height changes, but not my importance. Your hand guides me, and I help articulate what you want to say. When we part, I am not important or useful to you. What am I?

Last Week’s Riddle: It can be measured despite lacking length, width, or height.

What is it?

Answer: Temperature.

John Dombroski Jr. may be reached at (480) 991-1055 or [email protected]
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Posted on March 17, 2026