This week, markets rebounded after comments from President Trump suggesting the war could wrap up in 2 to 3 weeks. That was enough to shift sentiment quickly, and you saw buyers step back in almost immediately. It’s a good reminder of how this market is positioned. It wouldn’t take much to swing things the other way, and we saw that play out in real time. Just a hint of a timeline was enough to reverse about half of the S&P 500 year to date losses.

At the same time, part of the bounce was technical. The Nasdaq briefly hit a 10% correction, which tends to bring in dip buyers, especially in a market that still has strong underlying demand for large cap tech. The combination of oversold conditions and a potential path toward de escalation helped fuel the move higher.

But as the week went on, the tone slightly shifted. During a national address, President Trump warned of escalation and didn’t sound like there was a clear exit plan. That’s really where the uncertainty sits right now. There hasn’t been much detail around negotiations, and if this ends without the Strait of Hormuz reopening, that’s what markets are going to focus on. Iran has already demanded reparations and is likely to tax shipments, and there’s still no real clarity on Israel’s next move. So while markets reacted quickly to the idea of a timeline, the underlying situation hasn’t changed much.

We’re starting to see the market adjust to that reality. Yesterday, the U.S. doubled its commitment to provide reinsurance to ships moving through the strait to $40 billion. Major players like Travelers, Liberty Mutual, Berkshire Hathaway, AIG, Starr, and CNA are stepping in alongside Chubb. The key question now is whether operators are willing to take that risk, especially with the threat of drone attacks still in place. That will determine how quickly supply starts to normalize.

Oil is the key variable going forward. It’s the fastest way geopolitical risk feeds into inflation, growth expectations, and Fed policy. Higher energy prices act like a tax on consumers and businesses, and we’re already seeing inflation expectations drift higher. There are some forecasts moving toward 3.8% on headline CPI. What’s interesting is that the bond market hasn’t reacted aggressively to that. The message from rates is that investors expect the Fed to look through this as a supply driven shock rather than tighten into it.

If you look at how markets typically behave in these environments, the pattern is fairly consistent. Markets price in the worst case scenario quickly, volatility spikes, and then as long as things don’t escalate further, the panic starts to fade. That’s what we’re seeing now. The market reacted quickly to the idea of a timeline, but going forward it’s going to be less about headlines and more about oil. If oil stays elevated or moves higher with escalation, markets will likely move lower. If it stabilizes, markets can continue to grind higher even with uncertainty still in place.

From a portfolio standpoint, this is not a time to chase headlines. It’s one of those periods you ride out in high quality companies, and diversification matters more here than usual. There will be a time to be more aggressive in individual stock selection, but this isn’t it. Right now, everything is moving together on any given day, and even the Dow and Nasdaq are trading more in sync than usual, along with international markets.

The next real opportunities will likely come from longer term themes like infrastructure and the continued AI buildout. But in the near term, the bigger picture hasn’t really changed. Markets are adjusting to a world with a little more inflation pressure and a little more uncertainty, but not one where growth is falling apart. Staying disciplined and diversified here matters more than trying to predict the next headline, because nobody knows exactly how this plays out.

Have a great weekend!

* Military.com / AP: Analysis of Trump’s “Two to Three More Weeks” commentary (April 1–3, 2026).

* The Motley Fool / Reuters: Nasdaq-100 technical correction data (10.6% decline) and dip-buying activity (March 31, 2026).

* WSLS 10 / Bloomberg: Market reaction to the lack of clear exit plan in national address (April 2, 2026).

* Bloomberg News / Financial Post: Details on $40 Billion Hormuz Reinsurance Guarantees and participating insurers (April 3, 2026).

* The Times of Israel / Al Jazeera: Status of Iran-U.S. truce negotiations and Strait of Hormuz sovereignty demands.

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