This week was supposed to be about jobs numbers and the next twist in the artificial-intelligence boom. Instead, Americans are refreshing oil-price charts and scanning maps of the Strait of Hormuz.

Investors are responding in the usual way: running toward what feels solid and away from what feels fragile. The dollar and the Swiss franc are stronger. Gold is up. Defense stocks are surging. Oil companies are enjoying their moment in the sun. Meanwhile, airlines are tumbling as flight suspensions and higher fuel costs squeeze margins from both ends. Cruise lines are sliding, too. Big banks are under pressure. Even tech giants - already jittery about rising bond yields and lofty valuations - are feeling the heat as higher oil raises the risk of an inflation rebound.

The VIX, Wall Street's so-called "fear gauge," has climbed to its highest level in three months. Treasury yields, after an initial dip, are edging back up as traders rethink how quickly the Federal Reserve can cut rates if energy prices reignite inflation. One strategist suggested that if crude shoots above $100 and stays there, the S&P 500 could fall roughly 13% from its last close. Corporate earnings might take a measurable hit in what economists politely call an "oil-driven stagflation shock." No one enjoys that phrase, except perhaps oil executives.

All of this lands at a precarious moment. Stocks just logged their steepest monthly decline in nearly a year, rattled by concerns about artificial-intelligence disruption, stress in private credit, and uncertainty over trade policy after the Supreme Court struck down key tariffs. Investors were already tired. Now they are also anxious.

The coming days will test not just markets but political nerves. President Donald Trump said the conflict could last four weeks. That timeline alone is enough to keep volatility elevated. Manufacturing data arrives today. The February jobs report lands later this week, just two weeks before the Federal Reserve's March meeting. A strong labor market could box the Fed in if inflation expectations tick up alongside gasoline prices. A weak report could spark fears that the economy is slowing just as energy costs rise. Pick your poison.

To understand how we got here, rewind a few months. In January, protests shook Iran's regime. A crackdown followed. Trump threatened intervention, then stepped back. The U.S. quietly built up forces in the region while negotiations with Tehran resumed under Omani mediation. Ten days ago, reports hinted that a major conflict might be near. Then the story faded, crowded out by court rulings and AI headlines. American and Iranian negotiators even reported progress in Geneva last week, with more technical talks planned in Vienna.

Then came Saturday. The United States and Israel launched Operation "Epic Fury," targeting military infrastructure and senior Iranian leadership. According to reporting over the weekend, the CIA learned of a meeting at the Supreme Leader's residence in Tehran. The strikes killed Ali Khamenei, who had ruled since 1989, along with dozens of other senior officials, including top military commanders. Iran retaliated with missile strikes on Israel and U.S. bases in the region, damaging sites in Gulf states such as the United Arab Emirates, Bahrain, and Qatar. The Pentagon confirmed the first American casualties. Hezbollah has fired missiles from Lebanon. European powers have warned they could join strikes if attacks on Gulf countries continue.

These are the facts so far, and the future is murkier. Regime change imposed from outside has a mixed record, to put it gently. It often produces instability faster than it produces democracy. The risks are obvious. Iran's Revolutionary Guard Corps - an enormous military, political, and economic force - remains intact. Removing a supreme leader does not automatically dissolve a system built over decades.

There is also the American public to consider. Only about one in four Americans supports U.S. strikes on Iran, according to a recent Reuters/Ipsos poll. Many voters who backed Trump in 2024 did so with little appetite for new foreign entanglements. The president, now in his second term and unable to run again, may be thinking less about approval ratings and more about legacy. In his weekend address, he invoked the 1979 hostage crisis and the 1983 Beirut bombing - traumas that still echo in American memory. Framed that way, the operation is not just a military move but an attempt to close a historical chapter.

It is also an enormous gamble. If the Strait of Hormuz remains closed for an amount of time or tanker insurance costs explode, the shock could ripple quickly through gasoline stations, grocery aisles, and corporate balance sheets. Higher energy prices would challenge one of Trump's stated priorities: keeping gasoline affordable. They would also complicate the Fed's path at a moment when bonds may no longer provide the same cushion they once did. One investment firm bluntly observed that the long end of the Treasury market may need to reprice higher by at least 50 basis points. In plain English: borrowing costs could rise even as risks mount.

Yesterday's world - of AI valuations, tariff litigation, and earnings calls from the likes of Nvidia, Broadcom, Costco, and CrowdStrike - has not disappeared. It has simply been shoved aside by events that feel larger and harder to model. Investors can estimate the earnings hit from $100 oil. They cannot easily quantify the political aftershocks of a regime decapitation.

Today's economic highlights:

On today's agenda: company gross profits in Australia; BoJ Himino's speech in Japan; FDI in China; in the United Kingdom, Nationwide housing prices and BoE consumer credit; in Germany, retail sales; in Switzerland, retail sales and procure.ch manufacturing PMI; in Spain, HCOB manufacturing PMI; in Italy, HCOB manufacturing PMI, full year GDP growth, and government budget; ECB President Lagarde's speech for the Euro Area; in Canada, S&P Global manufacturing PMI; in the United States, ISM manufacturing employment and ISM manufacturing PMI. See the full calendar here.

  • Dollar index: 98.160
  • Gold: $5,390
  • Crude Oil (BRENT): $78.73 (WTI) $72.03
  • United States 10 years: 3.96%
  • BITCOIN: $66,285

In corporate news:

  • Berkshire Hathaway's new CEO Greg Abel used his first annual letter (and FY/Q4 results) to stress continuity with Warren Buffett, keep the huge cash pile unhurried and dividend-free, while profits fell on weaker insurance income and a $4.5bn writedown of Occidental Petroleum (plus earlier Kraft Heinz writedown).
  • Segro said it signed a pre-lease with Amazon for an 86,400 sqm logistics centre in Germany.
  • Tesla's February registrations rose in France (+55%) and Norway (+32%) but fell in Denmark (-18%), signalling some stabilization in parts of Europe after two years of declining sales.
  • Exxon Mobil reported an equipment malfunction at its Joliet, Illinois refinery that resulted in flaring.
  • S&P Global Platts suspended certain Middle East crude/products/LNG bids and offers in its pricing processes due to shipping disruptions in the Strait of Hormuz linked to the U.S.–Iran conflict.
  • The UK CMA opened an investigation into whether Hilton, IHG and Marriott shared competitively sensitive pricing-related information via CoStar's STR analytics tool, and CoStar said it is cooperating.
  • Tata Consultancy Services expanded its partnership with Zscaler and launched an AI-powered "Workspace Experience Studio" built around Zscaler Digital Experience.
  • Block CEO Jack Dorsey said AI is enabling the company to operate with a much smaller workforce as it cuts over 4,000 jobs and accelerates AI embedding across operations.
  • Ericsson and Intel deepened collaboration to speed development toward commercial AI-based 6G networks across RAN/core/edge and cloud.
  • Amazon's cloud unit AWS reported connectivity issues at its Bahrain data center (after earlier disruption at its UAE region).
  • Banco Santander and Mastercard said they completed the first live end-to-end "AI agent" payment using Mastercard Agent Pay via Santander's live payments infrastructure.
  • Nvidia signals AI breakthrough with next-generation chip architecture According to reports in the Wall Street Journal, Nvidia is preparing to launch a new processor designed to accelerate AI workloads, a move poised to further disrupt the global computing landscape.
  • Moody's maintains negative watch on Warner Bros. Discovery following Paramount deal The ratings agency has confirmed that Warner Bros. Discovery's credit rating remains under review for a potential downgrade, following the group's high-profile announcement to acquire Paramount.
  • Tesla raises entry price for US Cybertruck to 69,990 USD In a shift in its pricing strategy, Tesla has increased the cost of its base-model Cybertruck in the United States, now starting at 69,990 USD.

Analyst Recommendations:

  • Applovin Corporation: Arete Research upgrades to neutral from sell and reduces the target price from USD 458 to USD 340.
  • Crowdstrike Holdings, Inc.: Piper Sandler & Co upgrades to overweight from neutral with a target price of USD 520.
  • Dutch Bros Inc.: Goldman Sachs upgrades to buy from neutral with a target price of USD 75.
  • Icon Public Limited Company: Zacks downgrades to underperform from neutral and reduces the target price from USD 152 to USD 93.
  • Netflix, Inc.: JP Morgan upgrades to overweight from rating suspended with a target price of USD 120.
  • Range Resources Corporation: Gerdes Energy Research LLC downgrades to neutral from buy with a target price of USD 44.
  • The Ensign Group, Inc.: Zacks upgrades to outperform from neutral with a price target raised from USD 224 to USD 245.
  • Verisk Analytics, Inc.: Raymond James upgrades to strong buy from outperform with a price target raised from USD 215 to USD 260.
  • Zions Bancorporation, National Association: Morgan Stanley upgrades to overweight from market weight with a price target raised from USD 70 to USD 75.
  • Ares Management Corporation: Barclays maintains its overweight recommendation and reduces the target price from USD 190 to USD 138.
  • Blackstone Inc.: Barclays maintains its equalweight recommendation and reduces the target price from USD 164 to USD 126.
  • Duolingo, Inc.: Barclays maintains its equalweight recommendation and reduces the target price from USD 230 to USD 110.
  • Exxon Mobil Corporation: Citi maintains its neutral recommendation and raises the target price from USD 118 to USD 150.
  • Godaddy Inc.: Baird maintains its outperform recommendation and reduces the target price from USD 200 to USD 125.
  • Henry Schein, Inc.: Jefferies maintains its hold recommendation and raises the target price from USD 72 to USD 89.
  • Inspire Medical Systems, Inc.: Zacks maintains its neutral recommendation and reduces the target price from USD 86 to USD 62.
  • Mastec, Inc.: KeyBanc Capital Markets maintains its overweight recommendation and raises the target price from USD 264 to USD 335.
  • Medline Inc.: BNP Paribas maintains its neutral recommendation and raises the target price from USD 38 to USD 49.
  • Micron Technology, Inc.: Stifel maintains its buy recommendation and raises the target price from USD 360 to USD 550.
  • Robinhood Markets, Inc.: President Capital Management Corp maintains its buy recommendation and reduces the target price from USD 179 to USD 98.60.
  • Roblox Corporation: Arete Research maintains its neutral recommendation and reduces the target price from USD 104 to USD 79.
  • Salesforce, Inc.: Phillip Securities maintains its buy recommendation and reduces the target price from USD 382 to USD 253.
  • Samsara Inc.: TD Cowen maintains its buy recommendation and reduces the target price from USD 57 to USD 45.
  • Servicetitan, Inc.: Loop Capital Markets maintains its buy recommendation and reduces the target price from USD 140 to USD 100.
  • The Trade Desk, Inc.: Baird maintains its outperform recommendation and reduces the target price from USD 70 to USD 30.