As we move through mid-March 2026, markets are grappling with heightened geopolitical tensions in the Middle East, alongside a batch of economic data releases that paint a picture of moderating inflation but slowing momentum in some sectors. This week’s Market Monitor highlights key inflation reports, growth revisions, and significant developments in technology and global affairs. Equity markets showed resilience amid volatility, supported by energy gains and AI enthusiasm, while bond yields rose and commodities, especially oil, surged on supply concerns.

Market Overview  

U.S. equities traded choppy but held relatively steady overall despite Middle East escalations and mixed data. Major indexes posted modest or mixed weekly performance, with energy sectors leading on oil price spikes. Fixed income saw Treasury yields edge higher amid uncertainty, while commodities rallied sharply, led by crude oil amid disruptions in key shipping routes.

Key Economic Releases

Despite the war with Iran in its third week, economic data marched on. Recent reports indicated contained consumer inflation pressures alongside signs of economic cooling in growth and manufacturing, offset by robust productivity potential in tech.  

February 2026 Consumer Price Index (CPI): Headline CPI rose 0.3% month-over-month and 2.4% year-over-year, unchanged from the prior month. Core CPI increased 0.2% monthly and 2.5% annually, reflecting manageable underlying inflation with contributions from shelter and food.¹  

January 2026 Personal Consumption Expenditures (PCE): The Fed’s preferred gauge showed headline PCE at approximately 2.8% year-over-year. Core measures eased modestly, signaling cooling but persistent price pressures.²  

Q4 2025 GDP Revision: The second estimate showed real GDP increasing at just a 0.7% annualized rate, a significant downward revision and sharp slowdown from Q3’s 4.4%. Full-year 2025 growth came in around 2.1-2.2%.³

December 2025 Durable Goods Orders: New orders fell 1.4% month-over-month, driven by transportation weakness, though ex-transportation orders rose 0.9%.⁴  

February 2026 Total Vehicle Sales: Sales declined approximately 3.8% to about 1.18 million units, with SAAR around 15.6 million, reflecting pressure on consumer discretionary spending and EV demand.⁵  

Notably, while consumer-facing CPI data continued to moderate, recent Producer Price Index (PPI) readings have shown stronger wholesale price gains (e.g., January PPI +0.5% MoM), indicating that producers may be absorbing costs or that there could be lagged effects on consumer prices. This divergence could support near-term corporate margins but warrants monitoring for potential pass-through.⁶

Nvidia GPU Technology Conference

In a highlight for technology investors, Nvidia CEO Jensen Huang delivered a keynote at the GTC conference on March 16, projecting demand for the Blackwell and Vera Rubin AI platforms to drive at least $1 trillion in sales through 2027—doubling earlier estimates and underscoring explosive growth in AI infrastructure.⁷ The "Vera Rubin" line refers to Nvidia's next-generation AI computing platform, which will succeed the current Blackwell generation.

Mideast Geopolitical Tensions

The week saw further escalation in the U.S.-Israeli campaign against Iran, with continued strikes on infrastructure and discussions of expanded operations against Hezbollah in Lebanon. Disruptions to oil flows through the Strait of Hormuz led to sharp increases in crude prices and volatility in energy markets. These developments add significant uncertainty to global supply chains and inflation outlooks.⁸

March Fed Meeting

The Federal Reserve concludes its two-day FOMC meeting today, with markets overwhelmingly expecting policymakers to hold the federal funds rate steady in the 3.50%–3.75% target range amid persistent inflation pressures from oil price shocks and geopolitical tensions.⁹  Traders are pricing in near-certainty (over 98-99% probability) of no change at this meeting, per CME FedWatch and prediction markets, while the updated dot plot and Summary of Economic Projections are anticipated to reflect a more cautious outlook for 2026 rate cuts—potentially fewer than previously projected, or even zero in some scenarios—as the Fed balances moderating growth with elevated inflation risks.10

Outlook

With inflation data showing stability around 2.4-2.8%, but growth moderating and geopolitical risks elevating energy costs, the economy demonstrates pockets of strength particularly in services and AI-driven productivity.1 However, softer orders and sales data, combined with international tensions, call for caution. Our team continues to emphasize high-quality, diversified portfolios positioned for both resilience and long-term technological opportunities.  In the near term, any indication of the Mideast war ending should be a boost for risk assets.

Best regards,  

Richard Barnett, CFA, CIMA, CAIA

Chief Investment Officer  

Footnotes:

1. U.S. Bureau of Labor Statistics, Consumer Price Index - February 2026, https://www.bls.gov/news.release/cpi.nr0.htm  

2. U.S. Bureau of Economic Analysis, Personal Income and Outlays - January 2026.  

3. U.S. Bureau of Economic Analysis, GDP Second Estimate Q4 2025, https://www.bea.gov/news/2026/gdp-second-estimate-4th-quarter-and-year-2025  

4. U.S. Census Bureau, Durable Goods Orders - December 2025.  

5. GlobalData / Automotive News, U.S. Auto Sales February 2026.  

6. U.S. Bureau of Labor Statistics, Producer Price Index - January 2026.  

7. CNBC / TechCrunch, Nvidia GTC 2026 Keynote Coverage, March 16-17 2026.  

8. Institute for the Study of War / Reuters, Iran Conflict Updates March 2026.  

9. CME Group FedWatch Tool and Kalshi prediction markets, as of March 17, 2026 (showing 98-99%+ probability of hold at 3.50-3.75%).

10. Bloomberg, Mariemont Capital, and Seeking Alpha reports on shifting 2026 cut expectations due to oil/inflation dynamics, March 2026.

Researched and compiled with the assistance of Grok.  This newsletter represents our opined general assessment of the market environment at a specific time and is not intended to be a forecast or guarantee of future performance or results. The opinions and statements expressed are intended for information purposes only, and does not constitute investment advice, a recommendation or an offer or solicitation to purchase or sell any securities or investment strategies to any person in any jurisdiction in which an offer, solicitation, purchase or sale would be unlawful under the securities laws of such jurisdiction. This material may contain estimates and forward-looking statements, which may include forecasts and do not represent a guarantee of future performance. This information is not intended to be complete or exhaustive and no representations or warranties, either express or implied, are made regarding the accuracy or completeness of the information contained herein. The opinions expressed are as of March 17, 2026, and are subject to change without notice. Investing involves risks. Past performance is not a reliable indicator of current or future results, and index returns do not account for fees. It is not possible to invest directly in an index.  

Investment advisory and wealth management services are offered through Highline Wealth Partners, an investment adviser registered with the U.S. Securities and Exchange Commission. Registration does not imply a certain level of skill or training and does not guarantee investment performance.