Stock Market Week Ahead: The Restructuring Of Global Oil

This year, March came in like a lion wrapped in a flak jacket. As the U.S. war in the Middle East enters its fourth week, it is hard to imagine the month leaving like a lamb.

The global oil industry has rapidly restructured its trade routes as China, India Japan and South Korea pay up to replace oil lost due to Iran’s bottling up exports from Saudi Arabia, Qatar, Iraq, the UAE, and Kuwait in the Persian Gulf. Minus Iranian exports (which reportedly continue)  energy tracker Vortexa estimates that as much as 89% of the crude and related products that had normally passed through the Strait of Hormuz went to Asian markets.

This means that the big-four Asian buyers have paid up to seize oil and natural gas-related supplies normally headed for places like Pakistan and Bangladesh, just for starters. Both countries are reportedly seeing severe currency devaluation and fuel rationing. Germany and Italy have seen electricity and feedstock surcharges of up to 30% due to the loss of Qatari LNG. Vietnam, Thailand, and Indonesia are estimating a 15% slowdown in their plastics and electronics sectors this month, due to the loss of naphtha shipments from the Gulf.

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In the U.S. stock market, this vast shifting of supply chains has made it difficult to pin down the biggest winners from the spike in oil prices. Collectively, among oil and gas industry groups, shares of Canadian explorers and producers — led by Vermillion Energy (VET) and  Canadian Natural Resources (CNR) — have shown the largest advance over the past month. Houston-based APA (APA) gained 29% in March to lead the second-largest advance: the international explorers and producers group. Mexico’s Vista Energy (VIST) and Spain’s Repsol (REPYY) were right behind APA, up 25% and 26%, respectively.

The remapping of global trade and pricing caused by the Iran war will remain the stock market’s focus over the coming week. The first-quarter earnings season has slowed to a crawl. But several important conferences and activities scheduled in Congress could influence market action, or at least particular groups of stocks. The CERAWeek conference in Houston is likely to be the week’s hot ticket, with CEOs of Occidental Petroleum (OXY), Total Energies (TTE), Aramco, ConocoPhillips (COP), Cheniere Energy (LNG) and other major energy names scheduled to speak.

Stocks To Watch: A Watchlist Builder’s Notebook

The stock market continues to grind lower, testing or breaking further support levels. Investors should be very cautious about new buys until there is a sustained momentum. But keep building a watchlist of stocks showing strength. Nova (NVMI), Seagate Technology (STX), Texas Pacific Land (TPL), BWX Technologies (BWXT) and Powell Industries (POWL) all boast solid relative strength numbers and are around buy points. Dell reclaimed a breakout on Thursday, while chip-equipment maker Nova and hard-drive maker Seagate flashed buy signals. Nuclear play BWX Tech and AI cooling stock Powell are close to entries, with Powell behaving nicely at its 21-day exponential moving average.

Aerospace/Defense Earnings Spotlight On Karman Stock; AI Stocks Argan, Legence Set To Report

Stock Market Perspective: Pullbacks vs. Corrections

In the prior week, ended March 13, the S&P 500 had closed sitting at its 200-day/40-week moving average and the Nasdaq closed narrowly below that important level of technical support. The 200-day line can often act as a floor for consolidations, both for market indexes and for individual stocks.
The past week’s action saw both the Nasdaq and S&P 500 drop, in rising trade, significantly below that moving average. The Nasdaq undercut on Wednesday. The S&P 500 fought to hold support until Friday. In addition, both indexes cut below their prior lows from November. Such lows also can act as boundary markers, points where index or stock consolidations draw a line before moving higher.

Technically speaking, the next step could be a doozy. Technical markers for where the indexes could next begin to build a floor are vague.

The S&P 500 ended the week of March 13 5.2% off its Jan. 28 high. An index falling 5% or more is technically in a pull back. A drop of 10% or more marks a correction. More than 20% is a bear market.  The past week, the S&P 500 closed 6.3% off its record high from January. The Nasdaq closed 10% from its late-October high so, technically now in a correction.  The Dow has dropped 9.8% off its February record above 50,500.

How To Read Stock Charts

While the technical gauges for what may come next are vague, CFRA Chief Investment Strategist Sam Stovall provides some helpful perspective. Historically, Stovall writes, the S&P 500 has needed an average of only 28 days to fall into pullback mode, 80 days to reach a correction, and 245 days to dig into a bear market. This time around, the S&P 500 dipped into its pullback 50 calendar days after notching its record high. (Stovall gauges his data off market closes, which puts the S&P 500 high on Jan. 27 and the dip below 5% on March 18.)

Since WWII, the S&P 500 has never fallen into a bear market when it took more than 40 days to slip into a pullback, Stovall notes. CFRA anticipates a prolonged shutdown of the Strait of Hormuz will cause oil prices to remain elevated. The result is likely to be oil-induced inflation and any further rate cuts by the Federal Reserve this year being postponed or eliminated, leading to an economic slowdown or a possible recession.

Of the 13 U.S. recessions reported by the National Bureau of Economic Research since WWII, nine were preceded by S&P 500 bear markets. Four, "the recessions of 1945, 1953-1954, 1960-1961, and 1980, were initially anticipated by S&P 500 declines of 7% to 17% that recovered fully before falling into another decline in excess of 5%, Stovall wrote.

Stock Market Econ: DHS Funding Fight In Focus

The war in Iraq remains the focal point, for now, for most investors. But March ends in a very slow week for economic news, directing more attention to the partial shutdown of the Department of Homeland Security after funding lapsed on Feb. 14. Paychecks recently stopped for Transportation Security Administration workers, which has led to long lines at some airports amid worker absences and warnings from airlines. Senate Majority Leader John Thune threatened to cancel a two-week recess slated to begin on March 27 if there’s no deal. Democrats are insisting on Immigration and Customs Enforcement reforms, after agents fatally shot two Minneapolis residents.

CERAWeek: The Super Bowl Of Energy

Untamable oil prices have placed a spotlight on this year’s CERAWeek energy industry conference in Houston. Many top oil industry chief executives, legislators and industry experts are due to speak, Monday through Friday. Leading executives from Microsoft (MSFT), Alphabet (GOOGL) and other high-profile tech names are scheduled to speak, discussing the vast ramp up in power demand from the booming AI data center sector.

Digital Assets: Crypto Goes Before Congress

The U.S. House Financial Services Committee has two hearings on its docket next week that will examine how to integrate blockchain technology into traditional finance and other crypto-related policy discussions. On Wednesday, the House will hold a meeting on “Tokenization and the Future of Securities: Modernizing Our Capital Markets.” Topics at the hearing may include asset tokenization, smart contracts, regulatory oversight and blockchain-based upgrades of legacy systems. On Thursday, the committee will hold another hearing, “Innovation at the Speed of Markets: How Regulators Keep Pace with Technology.” That meeting will focus on regulating rapidly-evolving technologies.

Discussing Sports Integrity At Tottenham Hotspur

The International Sports Convention at Tottenham Hotspur Stadium in London on Wednesday and Thursday serves as a major B2B nexus for the global sports industry. The event has become a critical venue for news regarding sports betting, with its “Sports Integrity” forum and the Sports Betting Intelligence Unit. The “Americanization” of the global betting market has been a prime topic discussed by executives of DraftKings (DKNG), Flutter Entertainment’s (FLUT) FanDuel, and Genius Sports. And the conference has recently shifted its focus toward “gaming-first fandom,” including the integration of predictive markets, a la Kalshi or Polymarket, into the fan experience.

Berlin, Dallas Infrastructure Discussions

Two key infrastructure events are scheduled during the final week of March. In Berlin, the Infrastructure Investor Global Summit runs Wednesday through Friday and gathers policymakers with leading institutional investors and top fund managers. In Dallas, the Public-Private Partnerhsip Conference, or PC3, is an infrastructure confab that brings together developers, engineers, investors, lawyers and government officials. Speakers include the CEO of California’s High Speed Rail Authority, the CEO of LA Metro and the directors of Arizona’s water infrastructure finance unit and the Pennsylvania Department of Transportation at the Sunday-through-Wednesday event.

Stock Market Earnings Briefs

AAR (AIR), the Wood Dale, Ill.-based aerospace components supplier, already has a 32% gain this year. In its Tuesday report, analysts expect earnings growth to slow to 17%, from a prior four-quarter average of 27%. The steady as she goes revenue target calls for 16% growth. Shares turned volatile after the start of the Iran war, but analysts have held their ratings steady.

Hesai Group (HSAI) reports on Tuesday. Earnings growth for the China-based maker of light detection and ranging (LiDAR) products is seen slowing to a single-digit gain after four quarters of triple-digit advances. Shares dipped below their 200-day moving average over the past week, leaving the stock flat for the year.

Karman Holdings (KRMN) stock is trading near a 107.56 cup-with-handle entry ahead of its Q4 results late Wednesday. FactSet expects the defense contractor to report earnings of 12 cents per share on $132.6 million in revenue. KRMN has rallied more than 360% from its February 2025 IPO price of 22 per share.

The IBD Methodology

BitGo (BTGO) releases Q4 results on Thursday. FactSet expects the crypto infrastructure and custody provider to report a loss of 43 cents per share adjusted on $59.2 million in revenue. The thinly traded stock has tumbled from its Jan. 22 IPO price of $18.

Argan (AGX), the Arlington, Va.-based energy engineering firm, reports its fourth-quarter results on Thursday. Analyst target a 11% decline in earnings over a 2% revenue slip. Argan’s backlog nor than doubled in the second half of 2026, to $3 billion. And the company reported $727 million in cash.Shares are up 50% this year.

Rex American Resources (REX) also report on Thursday. Shares of the ethanol producers are thinly traded, but are up 10% from a February breakout. The stock has a 94 Relative Strength rating and a 91 Composite Rating from IBD.

Carnival (CCL) reports Q1 results early Friday. FactSet expects earnings to increase nearly 39% on more than 5% revenue growth. Rival cruise line Royal CaribbeanRCL noted positive booking and pricing trends with its late January report. However rising fuel prices may weigh on Carnival’s outlook as conflicts in the Middle East continue.

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