Market Commentary - Week of March 28, 2026

StoicFunds Signal Check

• Macro Regime: 🔴 Inflationary Bust (DBO > SPY, GLD > TLT)
• Market Stress: 🔴 Ultra-Safe — 4 of 4 signals elevated (SPY: −0.46, VWO: −0.69, VEA: −0.44, BND: −0.15)
• Momentum: 11 of 13 assets in BEAR. Only BULL: DBC (+3.44), XLE (+3.59)
• The models are reading this as a full defensive regime. When all four stress signals are elevated, the system shifts fully defensive regardless of everything else.

Iran War — The Only Thing Markets Care About

• Strait of Hormuz effectively closed — only a few ships per day, mostly Iranian crude to China. Iran is actually selling more oil now than before the war
• Refined products going parabolic — jet fuel, diesel surging. Airlines canceling thousands of flights. Thailand ordering government employees to work from home to reduce gasoline demand. Australian farmers reporting diesel shortages
• Trump proposed 15-point peace plan Monday — futures soared 200 bps. Iran rejected it Wednesday, demanded control over the Strait of Hormuz. By Thursday, hopes for peaceful resolution fading
• Iran's strategic position strengthening — by controlling 20% of global oil supply through the Strait, Iran becoming a regional hegemon. Reports of Thailand negotiating passage fees with Iran
• US sending Marines this weekend — expeditionary force, not invasion-scale (Iraq required 250K troops). Pentagon considering additional 10,000. Joseph Wang: every ground invasion begins this way
• US and Israel running low on munitions — interceptors, bombs, fighter aircraft all constrained. USS Gerald Ford (most advanced carrier) withdrawn from theater for 14-month repair — officially a "laundry fire," but other reports suggest Iranian missile/drone damage
• Wang's thesis: Iran wins by waiting — keep Strait closed a few more weeks, watch global economy and stock market implode, force Trump administration to desperately seek an off-ramp. War already very unpopular, pump prices rising, 401ks declining
• Goldman Sachs revised forecasts: PCE inflation raised to 2.9%, GDP lowered 30 bps, higher unemployment
• S&P multiple compressed from 24x to 21x — market no longer pricing rate cuts, now pricing recession risk

Private Credit — Credit Cycle Confirmed

• Apollo Debt Solutions ($25B flagship fund) — received 11.2% quarterly redemption notice, only honored 5% cap
• Moody's downgraded Future Standard/KKR $13B private credit fund to junk — non-accrual loans climbed to 5.5%, one of the highest in the industry
• Ares Strategic Credit ($10.7B fund) — received 11.6% redemption notices, only honored 5% cap
• Barclays scaling back asset-based lending to small borrowers after losses from Market Financial Solutions and Tricolor Holdings collapses
• Quote of the week: "These patterns signal the beginning of a credit cycle. This is what it looks like. Bad news starts to mount and then lenders begin to tighten underwriting standards and restrict credit to at first certain borrowers and more borrowers over time — and this process can lead to a recession."

Housing — All Three Legs of the Stool Wobbling

• Meritage Homes CEO Philippe Lord (Eisman interview): housing market has three legs — job growth, affordability, consumer confidence. All three now weakening simultaneously
• Consumer confidence at all-time lows since measurement began. Buyers reporting "lack of urgency" and "wait and see" attitude
• 10-year climbed to 4.4% due to war — further compressing affordability. Meritage now trading at 80% of tangible book value
• Job market turning negative — first negative private payroll print in a long time. Entry-level and affordability-focused segments feeling it most
• Mortgage buydowns keeping builders alive — captive mortgage companies subsidizing rates (6.5% → 5.5%), but this compresses margins. Back half of 2025 saw sales, revenue, and margins all decline
• Regulatory barriers to supply — "The reason affordability is so problematic is because local regulatory bodies have no incentive to help bring land to market in an affordable way. It's gotten worse and worse for decades."

Geopolitics — Multipolarity Accelerating

• Modern warfare = missiles and drones — leveling the playing field for middle powers (Iran, Russia). Carriers increasingly obsolete. Wang: "You can easily take them out"
• US industrial capacity gap — can't produce munitions fast enough. 14 months to repair a carrier. China can produce hundreds of drones/missiles per day
• Gulf allies rethinking alliances — US perceived as unable to protect allies and only focused on Israel. Korea, Japan, Gulf states hedging toward China
• Taiwan implications — Wang: "There is absolutely no way the US could wage war and protect Taiwan. It's just ridiculous."
• Blue sweep midterms probability rising — Polymarket pricing higher Dem probability. Iran war + inflation + broken populist promises. Wang: could mean regime change in US — higher taxes, more public services, stock market negative

The Great IPO Blastoff

• Three largest private companies all top $350B valuations — SpaceX ($1.75T with xAI merger), OpenAI ($730B), Anthropic ($380B). All expected to IPO this year
• SpaceX could file as early as this week — would be first 10-figure IPO in history. Musk plans to earmark 20-30% of shares for retail investors
• Each could shatter Alibaba's $25B record IPO raise from 2014
• Anthropic could go public in October, raising $60B+ per Bloomberg/The Information — would place it among 35 largest US-traded companies
• OpenAI preparing for late-2026 listing — SoftBank's $40B loan widely seen as IPO bridge
• Arm unveiled new AI server chip (Arm AGI CPU) designed for agentic AI applications in data centers — competing with AMD and Intel

Tariffs & Political Risk

• Trump proposing 10-20% broad tariffs, 60% on China — market impact depends on implementation
• Washington state millionaire tax already driving capital flight (Schultz bought $44M Miami condo)
• EU negotiating to drop tariffs on US goods to 15% in exchange for dropping US levies on most EU products. US Ambassador warned delays could kill the deal including $865B in energy sales (LNG — in short supply due to Iran war)

Fed & Rates

• Fed held at 4.33% — cautious approach. Inflation still above 2% target
• Market shifting from pricing inflation to pricing recession — on Friday, even as oil prices marched higher, market priced in more dovish policy path
• Wang: "I think the global economy is already in recession" — slow-motion train wreck as Strait remains closed, emergency stockpiles depleting

Earnings & Stocks

• Argan (AGX) earnings jumped 56%, sales +13% to $262M. Project backlog doubled to $2.9B. Data center construction + electrification driving growth
• Karman Holdings (KRMN) EPS surged 267%, revenue +47%. New CEO citing "generational increase" in demand for missiles and munitions. Shares dived despite beat
• Caterpillar, Marvell, Leonardo DRS, Equinix, Ensign showing relative strength in tough market
• Defense stocks continue catching bids — missile/munitions demand narrative confirmed
• Nike (NKE) at 52-week low ahead of earnings, stock down 10% after prior quarter