And it takes two side to agree to end a war. So although on March 11, President Donald Trump claimed that the United States had "won" the war against Iran and that the conflict "was over in the first hour”, obviously the Iranian administration doesn't agree. Not only did they state they have no intention to seek peace, they have also, despite the destruction of their military infrastructure, aircraft and navy, continue to mount very effective large-scale drone attacks. Numerous reports indicate that Iran has thousands of these inexpensive drones at their disposal and while they can only do limited damage in absolute terms because of the small warheads, they are still hugely effective in disrupting global economies as they continue to successfully hit not only military targets, but also commercial ones such as airports and stranded shipping in the Strait of Hormuz.

Thus even if the White House seeks an early exit due to rising economic costs and growing voter discontent and declares peace and goes home, there is a growing consensus that Iran may continue to fight for some time to perhaps deter future Israeli and US strikes.

So for the week investors were faced with:

• Ongoing volatility in the oil market with US crude futures spiking to $119 per barrel on Monday and then briefly slipping below $77 before ending the week at $98. As a reminder as recently as February 27th oil was $65 a barrel.
• On the economic front the US FED’s preferred inflation indicator: the Personal Consumption Expenditures or PCE was 3.1% in January, in line with expectations but still above the long-term inflation target of 2%.
• In addition, the U.S. economy expanded at a far slower pace in late 2025 than an initial estimate had indicated. Friday’s revision reveled that GDP grew at an annual rate of 0.7% in the fourth quarter. Way below the 1.4% estimate released in February and well below the 4.4% growth rate recorded in last year’s third quarter. 
• Last but certainly not least worries over private credit risks continue to bubble. Restrictions on investor redemptions are increasing and there were reports that some major US banks are now restricting lending to private credit issuers and at the same time marking down previously issued loans to them. The private credit concerns led to increased selling of the US financials shares and despite many analysts’ predictions that US banks would be one of the better performers this year, so far not so and US banking Index is down some 10% year to date. Regular readers will know I believe the private credit sector is increasingly fragile and as far back as March of last year I wrote “Worries continue over the state of the private credit market after the recent notable multibillion-dollar bankruptcies in the auto loan sector. More surprise blowups could well spillover into major banks and hedge funds both of which are big lenders”.

Thus, it should be no surprise that it was yet another losing week in financial markets and much like last week the only notable winners were energy and commodity foodstuffs. Most of the global indices are now in negative territory for the year with a couple of exceptions Canada being one of them. Although one has to wonder if this outperformance can last as our economy continues to stumble, Stats Canada reported 84000 lost jobs in February and the unemployment rate rose to 6.7%. Also reported was that total exports fell 4.7% in January, the biggest monthly drop since April 2025. Our trade surplus with the US narrowed (no surprise) and exports to other countries fell 6 1/2% after hitting the record high December.

 Is there any good news for investors? The answer is yes! Technical indicators, and readers know that I'm a big believer, have fallen into territory where market bottoms have previously occurred, we are talking about things like investor sentiment: bullish investors are now the lowest and the bearish investors are now the highest since November 12 . At the same time many technical selling indicators have reached the extreme levels last seen in the April 2025 tariff crash and as we all know, following these extreme readings, we were rewarded with a multi-month and impressive market rally. And let us not forget the US administration can change their tactics in the Middle East in a blink of an eye and again declare Victory, but this time actually stop bombardments. Such a move could be viewed very positively by investors.

So until we have further clarity my advice is we are in one of those periods where the smartest strategy is to “just sit on your hands”.

Dennis