NEW YORK, March 31, 2026, 13:07 EDT
The Dow Jones Industrial Average climbed roughly 1.2%, closing at 45,764.14 on Tuesday, as traders speculated that Washington could pull back from its military push against Iran—even with the Strait of Hormuz, a key oil corridor, remaining partially closed. Stock markets worldwide also rebounded, notching gains after a rough March.
The bounce hasn’t shifted the broader picture for the quarter. Both the Dow and S&P 500 are still on track for their sharpest monthly drop in almost four years, and their worst quarter since early 2022. The Dow wrapped up last week more than 10% below its all-time high, officially in correction territory—a term Wall Street uses for a retreat of 10% or more from a peak. “Relief rallies” are popping up, according to Hamilton Capital Partners’ chief investment officer Alonso Munoz, as traders latch on to any glimmer of positive news. Reuters
There’s also the way the Dow is built. According to S&P Dow Jones Indices, the benchmark follows 30 major U.S. stocks, but it’s price-weighted—so a company with a higher share price can have a bigger impact on the Dow’s moves than a larger company with cheaper shares.
It’s a tough macro environment out there. U.S. job openings slid by 358,000 in February, landing at 6.882 million, while hiring slipped to its weakest since March 2020. Brent crude, meanwhile, surged 5.5% and is on pace for its strongest monthly run ever—keeping inflation concerns and the path for interest rates front and center.
Mood swings were on full display Monday. The Dow eked out a 0.11% gain, but the S&P 500 slid 0.39% and the Nasdaq shed 0.73%. Donald Trump’s warnings to Tehran and the intensifying conflict erased earlier optimism over negotiations. Rick Meckler, partner at Cherry Lane Investments, described the White House’s messaging as “mixed messages.” Reuters
The S&P 500 is staring at about a 7% drop for the first quarter—its steepest hit since 2022—after a rough quarter-end stretch. Treasury yields moved higher, stoking doubts among investors who kicked off the year betting on Fed rate cuts. Higher energy prices have clouded that outlook, raising the possibility policy stays restrictive. “Inflation has become more of a headwind this year as oil climbed,” said Matt Orton at Raymond James. Reuters
Tech is still a sticking point for the Dow and the rest. Since the war broke out, the S&P 500’s tech sector has dropped almost 8%, a move strategists are watching closely. Big tech names keep driving sentiment—Orton called this a “perfect storm” for the sector, with investors yanking money from some of the market’s biggest gainers. Reuters
Headline risk persists. On Tuesday, traders weighed news of more Iranian attacks and the arrival of 2,500 extra U.S. Marines. Brent was holding close to $115 per barrel, U.S. crude near $104—a clear sign this market is still reacting sharply to the latest war developments.
That sets up the risk to the downside. Seema Shah, chief global strategist at Principal Asset Management, pointed out that the “noise” itself is what’s moving markets right now, making it tough to see past the volatility. According to Reuters’ latest quarter-ahead survey, many investors still figure that with Middle East energy infrastructure battered and oil prices stubbornly high, growth could take a hit—even if the conflict calms down. Reuters
Households are starting to feel the squeeze. U.S. consumer confidence inched up to 91.8 for March, yet the Conference Board noted that 12-month inflation expectations just hit their highest since August 2025. Gas prices over $4 a gallon aren’t helping. The Dow finished the day up, but those same pressures that dragged it down this quarter are still in play.
