By Tim Russell (President & Wealth Manager) at Life Financial Group
Originally shared on the Life in the Markets podcast — 3/23/2026
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Market Update for March 23, 2026
Third Straight Week of Market Declines
Markets declined for the third consecutive week. What stands out, however, is that despite heightened fear, most equity markets are only down 1–2% on the week. Moves of that size are not uncommon, even within a single trading day.
Yes, markets are trending lower, and that does impact portfolio values. But so far, both markets and portfolios appear to be holding up relatively well given the circumstances.
With ongoing conflict in Iran and oil approaching $100 per barrel, many investors are bracing for a larger sell-off. Yet since the conflict began roughly three weeks ago, the S&P 500 is down 5.4% and the Nasdaq is down 6.7%. While those declines are meaningful, they hardly qualify as a major sell-off. International markets are the only area nearing that territory.
From a portfolio perspective, we view this as a potential opportunity. We are exploring ways to increase exposure to international holdings and, in some cases, are already doing so. If you have questions about your allocation, we encourage you to reach out to your advisor.
Fear of Inflation and Fuel
One of the most immediate concerns tied to rising oil prices is the impact on fuel costs. As oil prices climb, gasoline and heating costs tend to follow. We’ve already seen a sharp increase in the national average price of gasoline since the beginning of the year.
Higher fuel costs ripple through the economy, affecting the price of a wide range of goods and services. Transportation, production, and heating expenses all rise, putting upward pressure on overall inflation.
It’s also important to note that there are multiple oil markets, which can lead to variations in the price per barrel depending on the benchmark being referenced.
Impact on GDP
Rising energy costs can also weigh on economic growth, as measured by Gross Domestic Product (GDP). GDP reflects the total level of economic activity within the economy.
Consider a simple example: if a household has $100 to spend, that money can be allocated across a variety of goods and services, dining out, technology, entertainment, and more. However, if fuel costs suddenly double, a larger portion of that $100 must be redirected toward gas. That leaves less available for other areas of the economy.
While those dollars still circulate, they become more concentrated in energy rather than being broadly distributed across sectors. This shift can slow overall economic activity.
Some estimates suggest that a sustained spike in oil prices could reduce GDP growth by as much as 0.5%. That may seem small, but when recent GDP growth was only 0.7% last quarter, the impact becomes much more significant.
What’s Happening with Bonds?
Another notable development has been the recent decline in the bond market, which may seem counterintuitive. Typically, when stocks fall, bonds rise as investors seek safety.
However, the current environment introduces another factor: inflation.
Bond prices are highly sensitive to interest rates. When rates fall, bond prices rise. When rates rise, bond prices fall. While the Federal Reserve plays a major role in setting short-term rates, inflation expectations also influence bond yields.
Think of it this way: if you’re investing in a bond for five years and expect inflation to average 3%, you would likely demand a yield above 3% to preserve your purchasing power. When inflation expectations rise, especially due to short-term uncertainty, investors demand higher yields.
As yields increase, bond prices decline.
This appears to be what we’re seeing today. Rising inflation expectations are pushing interest rates higher, which in turn is putting downward pressure on bond prices. Until there is greater clarity around inflation, both stocks and bonds may experience continued volatility.
Verse of the Week
1 Peter 1: 15-16 ESV – But as he who called you is holy, you also be holy in all your conduct, since it is written,“You shall be holy, for I am holy.”
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Disclaimer: The topics discussed here are for informational purposes only and do not constitute specific investment advice. Investing involves risks, including potential loss of principal. Past performance does not guarantee future results. Securities and advisory services offered through Geneos Wealth Management, member FINRA/SIPC.
