Week in Review: Oil Shock Meets AI Boom — March 2–6, 2026

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Two powerful forces collided this week: a historic oil shock driven by the escalating U.S.–Iran conflict and blowout AI semiconductor earnings that reaffirmed the durability of the artificial intelligence investment cycle. The tension between these narratives produced the most volatile week markets have seen in months.

How the Week Played Out

The S&P 500 closed Friday at 6,740, down 2.0% for the week — its steepest weekly decline in nearly five months and enough to push the index into negative territory for 2026. The Dow shed 3.0%, also turning negative year-to-date, while the Nasdaq held up comparatively well at −1.2%. The VIX (a widely followed gauge of expected market turbulence) spiked 24% on Friday to 29.49, its highest level since the tariff-driven volatility in April.

WTI crude oil settled at $90.90 per barrel, surging 35.6% for the week — the largest weekly gain in the history of the futures contract. The catalyst: an effective closure of the Strait of Hormuz, through which roughly 20% of global oil normally flows. Vessel traffic has dropped to single digits from a typical pace of around 138 ships per day. Some analysts warn oil could reach $100–$150 if tanker traffic doesn’t resume soon.

The 10-year Treasury yield jumped 18 basis points to 4.14%, its biggest weekly move since April, as markets priced in renewed inflation risk. The dollar index rose 1.3% on safe-haven demand.

Jobs Data Delivered a Negative Surprise

Friday’s February payrolls report added fuel to the fire. The economy lost 92,000 jobs — a dramatic miss against the roughly +59,000 consensus — marking the third negative print in the last five months. The unemployment rate ticked up to 4.4%, its highest since 2021. Weakness was broad-based: healthcare contracted by 28,000 (largely strike-related), while manufacturing, construction, and transportation all shed jobs.

To make matters worse, wage growth came in hot at +0.4% month-over-month, above expectations. A weakening labor market paired with sticky wages and surging energy costs creates the worst-case setup for the Federal Reserve. Markets are pricing a 97.3% chance the Fed holds rates at 3.50–3.75% at the March 18 meeting.

AI Silicon: A Bright Spot in a Difficult Tape

Against this challenging macro backdrop, back-to-back earnings from Broadcom (AVGO) and Marvell Technology (MRVL) demonstrated that AI infrastructure demand continues to accelerate.

Broadcom delivered record revenue of $19.31 billion (+29% YoY), with AI semiconductor revenue hitting $8.4 billion — up 106% year-over-year. CEO Hock Tan guided Q2 revenue to $22.0 billion, well above consensus, and stated the company has line of sight to exceeding $100 billion in AI chip revenue by fiscal 2027.

Marvell posted record Q4 revenue of $2.22 billion and guided for full-year FY2027 revenue approaching $11 billion, representing over 30% growth. The company expects to supply data-center interconnect modules to all five major U.S. hyperscalers this year.

Energy was the only S&P 500 sector to finish the week positive (+0.7%), extending its lead as the top-performing sector of 2026. Consumer Staples and Materials both fell roughly 5%, while rate-sensitive sectors like Utilities and Real Estate suffered from the yield surge.

What to Watch Next Week

Wednesday’s February CPI report could be the week’s most consequential data point. If oil-driven inflation shows up in the headline number, it would further constrain the Fed’s room to ease. Developments in the Iran conflict remain the dominant variable — any signs of de-escalation could trigger a sharp relief rally. Oracle (ORCL) and Adobe (ADBE) earnings will test whether the AI spending cycle is broadening into software.

The Bottom Line

The weight of evidence suggests macro risks are the dominant force in the near term. With oil above $90, the VIX near 30, and yields climbing, the market is signaling continued volatility ahead. The AI semiconductor complex may offer relative shelter within tech given its strong fundamental momentum, but the resolution of the geopolitical crisis remains the single most consequential variable for all risk assets. The range of potential outcomes from here is unusually wide — and positioning should reflect that uncertainty.

Detailed Market recap for this week can be found below. Please consider Subscribing as a paid member of this community, I am sure you will find its worth as we progress through time.