The S&P 500 index fell 1.9% last week, marking its fourth weekly loss in a row, as the war in Iran continues. The index has lost 5.4% in March and is down 5% for the year to date.
The US-Israel war with Iran has entered its fourth week with no clear end in sight. The US sent more Marines to the Middle East while Iran’s new supreme leader said “safety must be taken away” from the country’s top enemies. Oil prices have climbed as the Strait of Hormuz remains effectively closed, disrupting energy supplies and triggering inflation concerns.
Data released Wednesday showed US producer prices rose at the fastest pace in seven months in February amid notable spikes in wholesale costs of food and energy, as markets braced for higher inflation due to the Iran war.
Also on Wednesday, the Federal Reserve’s Federal Open Market Committee kept its monetary policy steady amid uncertainty around the Middle East conflict. “The implications of developments in the Middle East for the US economy are uncertain,” the FOMC said Wednesday.
Most sectors in the S&P 500 fell last week, led by a 5% loss in utilities and declines of 4.5% each in materials and consumer staples. Real estate fell 4%, while health care shed 3% and consumer discretionary lost 2.7%. Technology, industrials, and communication services also declined.
Just two sectors rose: Energy climbed 2.8%, and financials eked out a 0.4% increase.
This week, earnings reports are expected from companies including GameStop (GME), Core & Main (CNM), PDD Holdings (PDD), and Carnival (CCL, CUK).
Economic data will include a revised report on Q4 productivity, the February import price index, and a final reading on March consumer sentiment.
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