Aya covers continued market volatility this week, as the sentiment pendulum swung between cautious optimism that the Iran conflict could wind down, and inflation concerns driven by $100 per barrel oil. Watch the full video to hear the latest updates on interest rates, AI enthusiasm, and the energy sector.

TRANSCRIPT:

Hello, and welcome to this week’s 7 Market Movers video from Wealth Enhancement. My name is Aya Yoshioka, Director and Senior Investment Strategist. Each week, we highlight the headlines that captured the market’s attention and what it means for investors.

So this week, markets continued to to whipsaw, driven primarily by developments out of Iran and the impact on oil prices. No surprise there. Investor sentiment swung between optimism and concern about the conflict’s trajectory and overall duration.

Crude remained above the psychological $100 per barrel price as markets reacted to all of these headlines and president Trump’s speech on Wednesday night. Higher oil can lift headline inflation. It can pressure consumer spending through higher gas prices, to say the least, and it keeps central banks cautious. So every new headline quickly feeds into rates, the dollar, and equity valuations.

This week, we also heard from Fed Chair Jerome Powell, who spoke at Harvard University, and markets looked to dissect his comments in combination with incoming economic data, trying to answer a key question, which is, does the current oil shock delay the relief in rates? Remember, markets entered 2026 expecting one to two interest rate cuts, and that has been adjusted accordingly since the conflict began. Powell reiterated that the Fed is watching how energy prices are feeding into the broader inflation picture, and markets took that as confirmation that policy can stay higher for longer if inflation progress stalls.

Elsewhere, a European Central Bank governing council member stated that the Iran conflict is pushing the euro area economy into or closer to the ECB’s adverse scenario projections, meaning that the next policy move from the ECB could be an interest rate increase, another example of the impact of the conflict in Iran.

As mentioned earlier, we did get some economic data across the US this week. Most importantly, we got the ISM Manufacturing Index, which showed US manufacturing activity expanding in the month of March, and it expanded by the most amount since 2022. However, the report’s significant or most significant market moving component was the prices paid index within that, which was at the highest level since mid 2022.

This week, we also saw initial jobless claims, which were released this morning, and that showed little bit of a decline, which was nice to see in order to keep labor markets relatively steady.

We also got indications from the Atlanta Fed’s GDP now index, which fell to 1.64% from the 1.95% last week. And this projection is now below the 2.35% consensus forecast from economists, but it’s just a lot quicker, just reflecting some of these headlines that we’ve seen this week.

The economic data’s market impact was really overshadowed by the geopolitical headlines and was largely interpreted through the lens of inflation concerns. The International Monetary Fund or IMF stated that while US inflation is on its course to return to the Fed’s 2% target, it likely won’t be until the first half of 2027.

This week, we also saw the end of the quarter trading as as well as optimism on the conflict lead to some big moves to close out the first quarter of 2026. We saw some profit taking in the energy sector. We saw a little bit of a rebound in tech and rate sensitive growth pockets remained a bit choppy. We also saw some semiconductor volatility flare up again, especially on the memory side. And the chip complex moved had some big moves in both directions. Investors continue to be scrutinizing overall AI enthusiasm as well as near term earnings and inventory cycles for many of these chip companies.

Tech is still the market’s largest weight, and when rates are volatile, investors demand cleaner fundamentals. That’s why pockets of tech can act more like long duration bonds with bigger swings as yields and growth expectations adjust.

Looking at market performance, US equities were positive on the week. Europe and emerging market stocks were also up. Stocks in Asia ended lower, but they still have another day to go. And interest rates saw slight declines as treasuries repriced inflation expectations. And gold was up 4% this week, and the US dollar was flat.

Markets stayed highly headline driven, repricing yields and rotating equity leadership as investors tried to separate short term geopolitical shocks from the longer term growth picture.

In short, this week’s developments underscored how geopolitical risk, energy price movements, and central bank policy expectations remain very closely intertwined, creating challenging economic or challenging market conditions for investors.

But it also makes the case for prudent, diversified, and disciplined portfolio positioning and risk management.

Thanks again for listening. Happy Easter to all of you, and we hope to see you next week.