Two Days In, and the Market Is Still Standing

AUAM Market Update | March 17, 2026

Markets don't usually reward patience, but this week they might be trying to. After a bruising stretch three straight weeks of losses, a war in Iran rattling energy markets, and oil threatening to stay above $100 equities bounced hard on Monday and are holding their ground Tuesday morning. It's not a clean breakout. But it's something.

The S&P 500 closed Monday up 1%, the Nasdaq gained 1.2%, and the Dow added 0.8%. About two-thirds of the market finished in the green. The VIX dropped more than 13%, signaling that at least for now, traders are willing to take some risk back on. That's a notable shift from where sentiment was sitting just a week ago.

"The market is absorbing bad news without breaking. That's not nothing."

Three things drove Monday's strength, and they're worth understanding separately because they tell different stories:

First, AI came back. Nvidia's annual GTC conference is underway in San Jose, and CEO Jensen Huang delivered exactly the kind of headline that reminds the market why it's been betting so heavily on this trade: $1 trillion in projected AI chip revenue through 2027. Nvidia shares rose 1.6%, Meta added 2.3%, and semiconductors broadly outperformed. After weeks of selling, the AI narrative hasn't died it just needed a catalyst to resurface.

Second, oil eased. Even slightly. Crude pulled back from its recent peaks on Monday, and that was enough for equities to exhale. With the Iran conflict continuing to disrupt flows through the Strait of Hormuz, energy is still the wildcard in every macro scenario right now. But the market showed that even a small reduction in oil-driven anxiety is enough to move the needle.

Third, financials and asset managers surged. Goldman Sachs was among the top Dow performers. KKR, Blackstone, BlackRock, and Blue Owl each jumped 3–5% as traders reassessed the risk of loan defaults in the private credit market a sign that the credit panic building in the background may be somewhat overpriced.

Tuesday's Key Watch Items:

- FOMC meeting begins today the rate decision and updated dot plot drop Wednesday. The Fed is almost certain to hold at 3.75%, but the forward guidance around energy-driven inflation is what matters most.

- Oil is back above $95 this morning, with Brent crossing $101 at times. Every tick higher tightens the Fed's options and weighs on consumer-facing sectors.

- Delta raised its Q1 revenue outlook above forecasts, citing accelerated consumer and corporate demand a quiet signal that the U.S. consumer is more resilient than the macro bears suggest.

- Earnings tonight: Lululemon, Docusign, and Oklo. Small data points, but each adds texture to the consumer and energy stories.

The Tension Under the Surface:

Here's the honest read: this is a market trying to price two incompatible things simultaneously. On one hand, corporate earnings are holding up, consumer demand is resilient, and AI investment is accelerating. On the other, oil near $100 is a tax on everything it hits households, compresses margins, and gives the Fed less room to cut.

The Fed meeting this week crystallizes that tension. There's a 99% chance they hold rates steady on Wednesday. But the dot plots the Fed's own projection of where rates are headed is the real event. If policymakers signal that elevated energy prices have pushed rate cuts further out, markets will need to reprice. If they sound patient and data-dependent, the rally has room to continue.

The S&P 500 is sitting just below a key technical level the 6,731–6,782 zone it broke down through earlier this month. Getting back above that range on a closing basis would be a meaningful signal that the correction is over. Failing there keeps us in a range-bound, headline-driven environment.

What This Means for How We're Thinking At AUAM:

This kind of environment technically fragile, narratively complex, event-driven is where selectivity pays off more than conviction on direction. The macro picture is genuinely uncertain. What's less uncertain is which parts of the market are priced for bad news, and which aren't. Energy continues to benefit from the geopolitical backdrop. Financials are recovering from what looks like oversold credit fears. AI infrastructure names got a reminder of why the long-term thesis is intact. And companies like Delta, showing real demand strength despite a difficult operating environment, are worth watching as a read on consumer health. The rally is real. The risks are real. Neither cancels the other out they coexist, and that's exactly the kind of market where being thoughtful about what you own matters more than just being in or out.

"This isn't a euphoric rally. It's a resilient one. And those are different trades."

Bottom Line Markets are in the middle of a two-sided tug-of-war between strong corporate fundamentals and macro headwinds that refuse to fade. Wednesday's Fed decision and updated projections will be the next defining moment. Until then, the tape is trying to find its footing and so far, it's doing a better job of that than most expected a week ago.