March 2nd Market Overview

Happy Monday

Wild session. Markets opened down hard on the Iran situation then reversed almost entirely by lunch. Oil is higher but honestly not as high as I expected given everything happening over there. I think crude is the only chart that matters this week. If it can't break and hold above $80, the market is telling you this stays contained.

Let’s dig in...

Today's Big Picture

1. U.S.-Israel Strikes Kill Khamenei, Oil Rips, Strait of Hormuz Goes Dark 

Trump claimed "48 leaders gone in one shot" and dubbed it "Operation Epic Fury." Maersk suspended all Strait of Hormuz transits and QatarEnergy halted LNG production after strikes hit two facilities. Brent crude hit a 52-week high above $78 as insurers pulled coverage for Gulf vessels.

2. Markets Staged a Wild Reversal as Tech Played Safe Haven 

The S&P 500 fell over 1% at the open and clawed all the way back to green by early afternoon. Buyers went straight for Nvidia, Microsoft, and the other cash-rich names the moment the bell rang. It says something about this market that semiconductors and software are now the defensive trade during a war. Wells Fargo data shows the S&P 500 typically turns positive within two weeks of a major conflict.

3. Bond Yields Pushed Back Above 4% on Inflation Fears 

Treasurys initially rallied on safe-haven flows, then reversed hard. The ISM manufacturing prices index shot up 11.5 points to 70.5. Fed-funds futures now show less than a coin-flip chance of a rate cut by June, down from a clear majority just last week. The market went from pricing cuts to pricing sticky inflation in about four hours.

Market Overview

Index Performance (Oil today)

Stock Spotlight

Nvidia $NVDA ( ▲ 2.87% )  
management told UBS they are already planning compute capacity buildouts well into 2027. The chipmaker also announced $2 billion investments in both Lumentum $LITE and Coherent $COHR to accelerate optics for AI infrastructure. UBS reiterated Buy with a $245 target.

Palantir $PLTR ( ▲ 5.4% )  
saw massive inflows from retail investors during the first hour of trading. VandaTrack data showed millions flowing in on a net basis alongside energy ETFs. Selective repositioning, not panic.

CrowdStrike $CRWD ( ▲ 2.95% )  
caught an upgrade from Piper Sandler to Overweight with a $520 target. Analysts think the recent selloff on AI disruption fears went too far for a premium security platform. Shares had been down over 20 points YTD.

Big Name Updates

Berkshire Hathaway $BRK.B ( ▼ 4.91% )  
reported a sharp decline in operating earnings during Buffett's final quarter as CEO. Q4 came in at $10.2 billion, down roughly 30 from a year ago. Insurance underwriting got cut in half. New CEO Greg Abel used his first annual letter to promise continuity with Buffett's blueprint.

Norwegian Cruise Line $NCLH ( ▼ 10.61% )  
issued a disappointing annual outlook just as the industry faces rising fuel costs from the conflict. Management cited mistiming of Caribbean capacity increases. The timing is brutal for the entire cruise sector.

Lockheed Martin $LMT ( ▲ 3.28% )  
and the broader defense sector caught aggressive bids today. Citi expects a serious increase in missile-defense spending. Northrop Grumman $NOC and RTX $RTX both ran hard.

Amazon $AMZN ( ▼ 1.17% )  
dealt with a disruption to its web services in the UAE after unidentified objects struck a data center and caused a fire. Still no ETA on power restoration.

Other Notable Company News

AeroVironment $AVAV ( ▼ 17.13% ) got triple-downgraded by Raymond James to Underperform from Strong Buy after losing exclusivity on the $1.4 billion SCAR program with Space Force. Backlog could take a $1 billion to $1.4 billion hit.

Cameco $CCJ ( ▲ 5.44% )  
secured a $2.6 billion long-term deal to supply uranium to India's atomic energy department. Deliveries run 2027 through 2035.

MicroStrategy $MSTR ( ▲ 6.22% )  
bought another 3,015 Bitcoin worth $199 million for its corporate treasury.

Blue Owl Capital $OWL ( ▲ 1.33% )  
caught a downgrade from Barclays as Wall Street starts asking harder questions about the private credit boom. Shares have been cut in half over the past year.

Novo Nordisk $NVO ( ▲ 0.52% )  
got downgraded to Neutral by Goldman after CagriSema failed to show non-inferiority vs. Eli Lilly's tirzepatide on weight loss. Goldman cut estimates through 2030.

Apple $AAPL ( ▲ 0.33% )  
announced a budget-focused iPhone 17e and an upgraded iPad Air, with more product news expected later this week.

Today’s Sponsor

This Pre-IPO Stock Is Up 4,000% Already

How do you follow 4,000% valuation growth? By preparing for what’s next. That’s what pre-IPO company Immersed did, reserving the Nasdaq ticker $IMRS.

But the real opportunity for investors is now, before public markets.

Why? Immersed changed the game in extended reality (XR), developing the Meta Quest store’s most popular productivity app. They have more than 1.5M users, including Fortune 500 teams, many who already use it up to 60 hours a week.

But that’s not all. Immersed’s soon-to-be-released XR headset has 2M more pixels than Apple’s Vision Pro for 70% less cost and weight. No wonder they’re projecting $71M in first-year sales.

Immersed is redefining the $250B+ future of work. That’s why 6,000+ investors have already secured pre-IPO shares in Immersed’s growth.

They have partnerships in place with Qualcomm and Samsung. Executives and founders from Palantir, Facebook, Reddit, and Sailpoint invested. You can, too. But there’s no time to waste. Invest in Immersed before the opportunity closes.

Invest in Immersed

_{This is a paid advertisement for Immersed Regulation A+ offering. Please read the offering circular at https://invest.immersed.com/}

Sector Watch

Bond Market

Treasury yields pushed higher today. The initial flight to safety faded fast as traders worried that more expensive oil will reignite inflation.

• 10-year climbed back above 4 percent

A stronger than expected ISM manufacturing report kept the pressure on bonds. Tomorrow: watch if yields keep climbing or if the safety trade reasserts overnight.

Policy Watch

Fed The ISM headline at 52.4 was fine. The problem is the prices component at 70.5, up 11.5 points. Backlogs rose 5 points. Imports climbed 4.9. Employment still in contraction at 48.8. Rising input costs with a soft labor picture is not what the Fed wants heading into a potential energy shock. The central bank suddenly has a new variable to model.

International

• OPEC+ agreed in principle to a 206K barrel/day production hike for April. I'm not sure 206K does much when the Strait of Hormuz is effectively shut for commercial traffic.

• Chinese independent refineries rely heavily on Iranian crude. They have built up reserves, but a prolonged conflict will test those buffers.

Washington 
Secretary of State Marco Rubio briefed Senate and House leadership this afternoon on the Iran situation and base security in the UAE and Saudi Arabia. Trump said the conflict could last four to five weeks but added it could go "far longer than that." That is a meaningful shift from the initial rhetoric of wrapping this up over the weekend.

Fiscal & Trade 
Diesel futures had their biggest single-day gain since early 2022 when Russia invaded Ukraine. This matters more than gasoline because diesel moves goods. About 11 percent of global refining capacity sits in the Middle East. Higher shipping costs could bleed into consumer prices within weeks if this drags on.

What to Watch

Oil Prices Over the Next 48 Hours 
Everything trades off crude right now. Piper Sandler's Kantrowitz put it plainly: stocks won't move higher without oil moving lower. Wells Fargo's worst case is S&P 6,000 if Hormuz stays closed and oil hits $100+. Their base case is still 7,500 by year-end.

Strait of Hormuz Shipping Situation 
The difference between a two-week disruption and a multi-month disruption is the difference between a headline scare and real inflation pressure. Several international insurers already cancelled policies for Persian Gulf vessels. Watch if more shipping companies follow Maersk in suspending transits.

Diesel Prices 
Pay attention to the trucking market. Diesel futures moved aggressively higher today, which poses a much bigger threat to the cost of consumer goods than gasoline does. If this sustains for more than a couple weeks, it shows up in everything from grocery bills to Amazon shipping costs.

Software Shorts at 2008 Levels 
Deutsche Bank flagged that software short interest hit the highest level since the financial crisis. Median short interest above 5 percent across the sector. If the broader tech sector keeps catching bids, we could see some violent squeezes. Today's bounce in IGV was the first signal.

Thanks for reading - you are now the more informed 🙂

- John

Today’s Sponsor

If You Could Be Earlier Than 85% of the Market?

Most read the move after it runs. The top 250K start before the bell.

Elite Trade Club turns noise into a five-minute plan—what’s moving, why it matters, and the stocks to watch now. Miss it and you chase.

Catch it and you decide.

Get the Next Alert

_{By joining, you’ll receive Elite Trade Club emails and select partner insights. See Privacy Policy.}