Stocks Drift Lower as Oil Rebounds and Strait of Hormuz Tensions Resurface

U.S. equities finished mixed after a choppy midweek session, as a rebound in oil prices and renewed geopolitical tensions kept investors cautious. The S&P 500 slipped 0.1%, the Nasdaq Composite edged up 0.1%, and the Dow Jones Industrial Average declined 0.6%, reflecting a market struggling to find clear direction.

Energy markets once again dominated the narrative. Crude oil futures rose $3.03, or 3.6%, to settle at $86.88 per barrel amid fresh reports of instability around the Strait of Hormuz. According to reports, several cargo ships were struck by projectiles in the region, while U.S. forces reportedly sank multiple Iranian vessels during the confrontation.

Although the International Energy Agency confirmed that member nations will release approximately 400 million barrels of oil from strategic reserves to help stabilize markets, the announcement had little impact on trading as the plan had already been widely anticipated after it was signaled earlier in the week.

Equities briefly moved lower during the afternoon after additional geopolitical headlines surfaced. A report indicated that the FBI warned California law enforcement that Iran may have considered launching a drone attack from a vessel positioned off the U.S. West Coast in the event of American military strikes. The report added another layer of uncertainty to an already tense geopolitical backdrop.

Economic data offered little immediate relief. February inflation readings came in exactly as expected, with both headline and core CPI matching consensus estimates. While the data suggested inflation pressures remain stable for now, investors are mindful that next month’s figures may reflect the recent surge in fuel prices.

Despite the modest inflation reading, the broader market struggled to gain traction. Only three S&P 500 sectors finished higher.

The energy sector led the market with a gain of 2.4%, benefiting directly from the rebound in crude prices and moving back into positive territory for the week.

Technology stocks also managed a modest advance. Oracle was one of the top performers in the S&P 500 after delivering a strong earnings beat and raising its outlook. However, the broader software industry remained under pressure, reflecting ongoing concerns about the sector.

Weakness in software-related companies has begun to spill into other areas of the market. Asset managers faced renewed selling pressure after reports that some private credit portfolios tied to software companies are being marked down. Additional reports suggested that redemption requests at a major private credit fund exceeded 7%, reinforcing concerns about stress within the sector.

Financial stocks were among the day’s laggards as a result. Consumer staples also struggled, weighed down by disappointing earnings from Campbell Soup Company, which missed expectations and dragged down food producers.

Rate-sensitive sectors such as real estate and utilities also finished lower, reflecting a cautious tone across defensive areas of the market.

Elsewhere, losses were generally modest, allowing the major indices to close near unchanged levels despite broad underlying weakness.

Small- and mid-cap stocks followed a similar pattern, with the Russell 2000 declining 0.2% and the S&P MidCap 400 falling 0.3%.

Overall, the session underscored a market navigating a complex mix of geopolitical risk and economic uncertainty. With tensions in the Strait of Hormuz continuing to influence oil prices, energy volatility is likely to remain a key driver of market sentiment in the near term.

Our FTinvest 11 model portfolio declined 1.21% to close at 970.59, extending the recent downward trend and marking one of the sharper pullbacks of the year so far. The portfolio continues to retreat from its all-time high of 1,039.51, reflecting ongoing market pressure during the current correction phase.

Despite the recent decline, FTinvest 11 remains significantly higher than its levels at the start of the year and continues to demonstrate resilience after a strong early-2026 rally. The portfolio’s disciplined, value-driven framework remains central as it navigates short-term volatility while maintaining focus on long-term performance.