March 11th Market Overview

Happy Wednesday

Oil shrugged off the largest emergency reserve release in history and kept climbing. Three cargo ships got hit near the Strait of Hormuz today. I think wall street is way too relaxed about how long this drags on.

Let’s dig in...

Today's Big Picture

Record Oil Release, Prices Go Up Anyway 

The IEA put 400 million barrels of emergency reserves on the market across 32 countries, the largest release in history. Oil prices went up anyway. The math explains why: the Strait carries roughly 20 million barrels daily, and IEA members have never put more than 2.5 million barrels per day onto market. Opening the Strait is the only real fix, and nobody has a clear path to that right now.

Oracle Patches Its Cash Flow Problem 

Oracle beat Q3 estimates and raised its fiscal 2027 revenue target by $1 billion to $90 billion, with remaining performance obligations hitting $553 billion. The real story is how: AI customers are now paying upfront or supplying their own chips to secure cloud capacity, which directly addresses the debt overhang that cut this stock in half over the past six months. Still well off its highs, but this was the quarter the narrative changed.

February Inflation, Already Stale 

CPI came in exactly where expected at 2.4% year over year. Traders mostly shrugged, and for good reason. The Iran war didn't start until February 28, meaning none of the energy chaos registers in this data. March's print, out April 10, is where reality arrives, and the Fed will face a hotter number with no clean move available.

Market Overview

Index Performance (futures today)

Stock Spotlight

Papa John's $PZZA ( ▼ 7.03% )  
received a $1.5 billion takeover bid from Irth Capital Management at $47 per share, well above where the stock was trading before the news. The chain has already closed over 100 stores and plans 300 more by 2027.

Campbell's $CPB ( ▼ 4.45% )  
hit a 23-year stock low after missing Q2 on revenue, earnings, and guidance. Soup sales fell, snack sales fell harder. CEO Mick Beekhuizen blamed weak demand and storm disruptions. Consumers are trading down and the company hasn't stopped the slide.

Amazon $AMZN ( ▼ 1.46% )  
raised roughly €10 billion in European bonds for AI infrastructure, one day after a $37 billion U.S. bond sale. The company also won a court order blocking Perplexity's browser from scraping its shopping site.

Big Name Updates

Salesforce $CRM ( ▲ 2.08% )  
is issuing up to $25 billion in new bonds today to fund share buybacks.

Meta Platforms $META ( ▼ 2.48% )  
unveiled four custom-built chips for ads, recommendations, and generative AI inference. All four deploy across their data centers in 2026 and 2027.

Eli Lilly $LLY ( ▼ 2.33% )  
got a price target raise to $1,325 from Wolfe Research, who projects obesity sales hitting $78 billion by 2035. Lilly is also putting $3 billion into China manufacturing for its oral GLP-1 drug orforglipron, pending FDA approval.

Nike $NKE ( ▼ 2.84% )  
was upgraded to Overweight at Barclays with a $73 target. Running is back to double-digit growth in North America and Barclays thinks the market is overpricing China risk.

Other Notable Company News

AeroVironment $AVAV ( ▲ 4.61% )  
reported Q3 revenue of $408 million against $476 million expected. A significant miss.

Chubb $CB ( ▲ 1.97% )  
will lead underwriting for a $20 billion U.S. plan to insure commercial ships through the Strait of Hormuz.

J.M. Smucker $SJM ( ▼ 0.84% )  
was upgraded to Outperform at Bernstein. Green coffee fell from $4 to $3 per pound, which pads margins, and Elliott Investment Management is now in the mix pushing for better capital allocation.

Upstart $UPST ( ▼ 5.64% )  
applied for a national bank charter to fund its own consumer loans with deposits instead of relying on outside capital.

Redwire $RDW ( ▲ 1.11% )  
picked up an additional $4 million NASA contract for drug development research aboard the International Space Station.

Uber $UBER ( ▼ 2.63% )  
got a reiterated Buy and $103 price target from Bank of America. Uber One hit 46 million subscribers from 30 million last year, and analysts see delivery fee increases as manageable given that base.

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Sector Watch

Bond Market

The Treasury sold $39 billion in 10-year notes today to soft demand. Dealers absorbed 12.7% of the sale, well above their recent average. Institutional buyers don't want duration right now. The 10-year yield climbed to 4.21.

• Bespoke's Paul Hickey flagged 4.5 as the line in the sand, specifically if it gets there fast.

• Tomorrow: $22 billion 30-year auction. Worth watching after today.

Policy Watch

Iran conflict

Iran mined the Strait. U.S. forces sank 16 Iranian minelayers Tuesday. Three cargo ships were struck by projectiles Today, one caught fire and forced crew evacuation. The Navy is now refusing escort requests from oil companies, citing attack risk. Tehran is threatening continuous strikes and says oil hits $200.

Trump said the war ends "very soon." I don't see the off-ramp. Both sides have dug in.

One thing worth sitting with: BlackRock's Larry Fink said Wednesday that if Iran is neutralized and their oil market opens up, long-term energy prices could actually fall. The logic holds. Getting there is the problem.

Federal Reserve

February's inflation read technically clears a path for cuts. The energy shock makes that almost meaningless. March's CPI will capture the full oil spike and the Fed knows it's coming. Cuts look like a late 2026 story at best. Powell has no good options right now.

Fiscal and trade

• The federal deficit crossed $1 trillion through February, but is running about 12% below last year's pace as revenues grow faster than spending.

• Trump threatened to cut off trade with Spain over their opposition to the Iran campaign, same threat he made earlier this month before walking it back. Practically hard to execute since Spain shares a trade policy with the rest of the EU.

Other

• DHS resumed Global Entry at airports despite the ongoing government funding lapse.

• Maersk has 10 ships trapped in the Gulf running low on fuel.

• U.S. airlines are nearly fully unhedged on fuel with jet fuel now above $4 a gallon. Margin revisions are coming.

What to Watch

30-year bond auction Thursday 
$22 billion in 30-year notes tomorrow. After today's soft 10-year showing, watch how much dealers are forced to absorb.

March CPI on April 10
February's data missed the war entirely. March is where the oil shock shows up. Mark the date.

Strait of Hormuz 
The IEA release buys time. Every day the strait stays closed, the supply hole gets deeper. If we hit the weekend without progress on the mines, energy markets get ugly.

Small-cap energy 
Smaller domestic producers in $XOP are outperforming the majors. No Middle East exposure, full leverage to oil prices. If this drags on, the gap from $XLE keeps widening.

Thanks for reading - you are now the more informed 🙂

- John

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