We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Volatility is Expanding as Oil Prices Surge: Here's What to Do
It’s undoubtedly been a choppy start to 2026. Despite the back-and-forth price action, the S&P 500 is roughly flat through early March. And while the benchmark index is less than 2% away from all-time highs, numerous concerns remain top of mind for investors.
The most recent worry is the conflict in the Middle East. While we saw limited turmoil in equity markets as a potential escalation gained steam, oil markets were a different story with crude prices hitting their highest levels of the year.
Remember, we keep politics out of the conversation here. Our only concern is how we can best position our portfolios to align with leading themes.
Now that the US-Iran situation has escalated, the question isn’t how the market will react. Instead, the right question to ask is, “How will we respond to what the market does?”
The Latest Market Shock
The latest developments in the Middle East understandably have many investors on edge. As strategists, we face the grim task of separating the human toll from the economic and financial toll, which is never easy when lives are lost in times of geopolitical conflict.
Last weekend, the US and Israel announced a major military operation against Iran that killed Ayatollah Ali Khamenei. The coordinated offensive, dubbed “Operation Epic Fury,” was part of a massive US-Israeli joint effort that targeted regime leadership and military targets.
Iran quicky responded, attacking US military bases, Israel, and other targets across the region. These attacks deepened by both land and sea as the weekend went on.
How have markets responded to significant geopolitical and historical events in the past?
Generally speaking, these events can spark heightened volatility in the near-term, but stocks tend to bounce back fairly quickly. As serious as this escalation and the prospect of war are, prior instances have shown us that developments may not have much of an impact on US economic fundamentals or corporate profits.
These types of foreign conflicts are always tragic. We certainly don’t want to minimize them in any way, shape or form. But from an investment perspective, it’s important to keep in mind that markets have a way of moving past geopolitical events fairly quickly.
Of course, we cannot dismiss the risk that the latest escalation may develop further into a broader conflict. But the stock market’s track record of recovering quickly from these events can at the very least provide a sense of reassurance to investors.
Oil Prices Hit Highest Levels Since Last Summer
The foreign conflict intensified early this week after Israel and US jets launched new strikes on Iran. Iran continues to target oil infrastructure and other marks across the region. President Trump stated that the US would provide insurance for oil tankers and escort them through the Strait of Hormuz, which serves as a critical passageway.
This came after Iran's Revolutionary Guard Corps said the Strait was completely closed and that they would strike any ship that attempted transit. So far, at least seven vessels have been struck, according to media reports.
Oil prices have been showing momentum since the start of the year. WTI crude prices have now soared to their highest levels since the summer of last year:
Image Source: StockCharts
Overall, market volatility is expanding, downside directional movement is gaining steam, and the major indexes are testing critical support levels. But the market’s broader trend remains up, and right now we need to treat this as a pullback within the larger uptrend.
Leading Energy Stock Hovers Near 52-Week High
Energy stocks have led the charge this year by a wide margin. The Zacks Oils and Energy sector is handily outperforming the broader market with a 22% return year-to-date:
Image Source: Zacks Investment Research
Oil-related stocks tend to have a high correlation with the price of crude oil. Higher oil prices are good news for oil company margins and profits. As crude prices continue to move higher, the opportunity for investors to profit expands.
Baker Hughes (BKR - Free Report) is outperforming the market this year. One of the world’s largest oilfield service providers, Baker Hughes helps customers efficiently and cost-effectively refine and transport hydrocarbons with low environmental concerns.
Image Source: StockCharts
BKR stock is ranked favorably by our Zacks Style Scores, with bullish marks in our Growth and VGM categories. Baker Hughes has surpassed earnings estimates in each of the last of four quarters, with an average earnings beat of 12.7%. The stock has risen more than 36% this year.
Bottom Line
We need to keep the big picture in mind and remember that the primary secular trend is bullish and remains intact. We do not want to allow excessive fear of a pullback or deeper correction to harm our longer-term returns.
While it’s not a time to get aggressive, energy stocks are a good place to be at the moment. Make sure to take advantage of all that we offer here at Zacks to uncover leading stocks like BKR.
Disclosure: The author may hold an interest in the mentioned securities.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
View the Zacks #1 Rank List
Image: Bigstock
Volatility is Expanding as Oil Prices Surge: Here's What to Do
It’s undoubtedly been a choppy start to 2026. Despite the back-and-forth price action, the S&P 500 is roughly flat through early March. And while the benchmark index is less than 2% away from all-time highs, numerous concerns remain top of mind for investors.
The most recent worry is the conflict in the Middle East. While we saw limited turmoil in equity markets as a potential escalation gained steam, oil markets were a different story with crude prices hitting their highest levels of the year.
Remember, we keep politics out of the conversation here. Our only concern is how we can best position our portfolios to align with leading themes.
Now that the US-Iran situation has escalated, the question isn’t how the market will react. Instead, the right question to ask is, “How will we respond to what the market does?”
The Latest Market Shock
The latest developments in the Middle East understandably have many investors on edge. As strategists, we face the grim task of separating the human toll from the economic and financial toll, which is never easy when lives are lost in times of geopolitical conflict.
Last weekend, the US and Israel announced a major military operation against Iran that killed Ayatollah Ali Khamenei. The coordinated offensive, dubbed “Operation Epic Fury,” was part of a massive US-Israeli joint effort that targeted regime leadership and military targets.
Iran quicky responded, attacking US military bases, Israel, and other targets across the region. These attacks deepened by both land and sea as the weekend went on.
How have markets responded to significant geopolitical and historical events in the past?
Generally speaking, these events can spark heightened volatility in the near-term, but stocks tend to bounce back fairly quickly. As serious as this escalation and the prospect of war are, prior instances have shown us that developments may not have much of an impact on US economic fundamentals or corporate profits.
These types of foreign conflicts are always tragic. We certainly don’t want to minimize them in any way, shape or form. But from an investment perspective, it’s important to keep in mind that markets have a way of moving past geopolitical events fairly quickly.
Of course, we cannot dismiss the risk that the latest escalation may develop further into a broader conflict. But the stock market’s track record of recovering quickly from these events can at the very least provide a sense of reassurance to investors.
Oil Prices Hit Highest Levels Since Last Summer
The foreign conflict intensified early this week after Israel and US jets launched new strikes on Iran. Iran continues to target oil infrastructure and other marks across the region. President Trump stated that the US would provide insurance for oil tankers and escort them through the Strait of Hormuz, which serves as a critical passageway.
This came after Iran's Revolutionary Guard Corps said the Strait was completely closed and that they would strike any ship that attempted transit. So far, at least seven vessels have been struck, according to media reports.
Oil prices have been showing momentum since the start of the year. WTI crude prices have now soared to their highest levels since the summer of last year:
Image Source: StockCharts
Overall, market volatility is expanding, downside directional movement is gaining steam, and the major indexes are testing critical support levels. But the market’s broader trend remains up, and right now we need to treat this as a pullback within the larger uptrend.
Leading Energy Stock Hovers Near 52-Week High
Energy stocks have led the charge this year by a wide margin. The Zacks Oils and Energy sector is handily outperforming the broader market with a 22% return year-to-date:
Image Source: Zacks Investment Research
Oil-related stocks tend to have a high correlation with the price of crude oil. Higher oil prices are good news for oil company margins and profits. As crude prices continue to move higher, the opportunity for investors to profit expands.
Baker Hughes (BKR - Free Report) is outperforming the market this year. One of the world’s largest oilfield service providers, Baker Hughes helps customers efficiently and cost-effectively refine and transport hydrocarbons with low environmental concerns.
Image Source: StockCharts
BKR stock is ranked favorably by our Zacks Style Scores, with bullish marks in our Growth and VGM categories. Baker Hughes has surpassed earnings estimates in each of the last of four quarters, with an average earnings beat of 12.7%. The stock has risen more than 36% this year.
Bottom Line
We need to keep the big picture in mind and remember that the primary secular trend is bullish and remains intact. We do not want to allow excessive fear of a pullback or deeper correction to harm our longer-term returns.
While it’s not a time to get aggressive, energy stocks are a good place to be at the moment. Make sure to take advantage of all that we offer here at Zacks to uncover leading stocks like BKR.
Disclosure: The author may hold an interest in the mentioned securities.