NEW YORK, March 13, 2026, 14:07 (EDT)
Stocks edged lower Friday afternoon. Tech names led declines, pulling the Nasdaq Composite down 0.91%, while the S&P 500 slipped 0.38%. The Dow Jones Industrial Average hovered just 0.03% lower. Brent crude stayed north of $100 a barrel. LSEG data on Reuters market pages was delayed.
Markets caught a short-lived bounce when January inflation matched expectations, but the optimism faded fast. Traders reverted to fretting over sluggish growth mixed with persistent inflation. The focus now shifts to next week’s Federal Reserve meeting, where stagflation worries are front and center. Energy prices remain elevated with the Iran war dragging on, fueling investor anxiety.
The Commerce Department revised its fourth-quarter GDP figure to a 0.7% annualized gain, trimming the earlier 1.4% estimate. January’s data, meanwhile, had personal spending rising 0.4%. The Fed’s go-to inflation measure, the Personal Consumption Expenditures price index, increased 2.8% year over year, with core PCE—excluding food and energy—at 3.1%.
Chris Zaccarelli, chief investment officer at Northlight Asset Management, wrote in an email that both the economy and labor market had started losing steam even before the conflict in the Middle East erupted. Steve Sosnick, chief market analyst for Interactive Brokers, put it bluntly: higher oil prices piling onto a slowing economy is “not exactly a good combination.” AP News
Traders have quickly changed their outlook on rates. Barclays, following Goldman Sachs, now expects the Fed’s first cut in September. Meanwhile, LSEG figures reported by Reuters put the odds at just a single quarter-point rate reduction before June 2027.
Financials are feeling the pinch from private-credit turmoil. Morgan Stanley curbed redemptions in one of its private-credit funds following a jump in requests to pull money—a move that echoes recent trouble at both BlackRock and Blue Owl.
Big swings hit some names. Adobe dropped 6.4%—the announcement that CEO Shantanu Narayen will step aside after a replacement is chosen overshadowed record Q1 numbers and a reiteration of full-year guidance. Ulta Beauty shares tumbled 11.8% after the company’s quarterly earnings landed shy of profit forecasts.
Pressure on stocks didn’t start Friday. U.S. equity funds saw $7.77 billion head out the door in the week ended March 11, marking a second consecutive week of redemptions. Bond funds, by contrast, pulled in $8.21 billion as investors shifted to safer ground.
Consumers are feeling the pinch. The University of Michigan’s first March sentiment reading dropped to 55.5—down from 56.6 in February—marking a new low for the year. Households cited higher gasoline costs and lingering worries tied to the ongoing conflict.
Oil remains the pivotal factor for now. Goldman projects Brent could slip to the low $70s later this year should supply disruptions subside. But if the Strait of Hormuz is closed for two months, their fourth-quarter Brent forecast jumps to $93 a barrel, up from $71. That kind of surge would likely stoke inflation fears and put more heat on equities.
Investors now have their eyes on the Fed’s March 17-18 meeting—and the fresh economic projections that come with it—scanning for clues on whether policymakers see the oil shock as manageable or as something that could dash expectations for rate cuts.
