Global markets are facing heightened uncertainty as slowing U.S. economic growth, rising geopolitical tensions, and surging oil prices dampen the outlook for investors. With fears of stagflation and financial stress resurfacing, markets are sending mixed signals. Let’s delve deeper.

U.S. Economic Growth Slows Sharply in Fourth Quarter

The U.S. economy expanded at a much weaker-than-expected pace in the fourth quarter, growing at an annual rate of 0.7% from October through December, according to the Commerce Department’s revised estimate.

The figure marked a sharp slowdown from 4.4% growth in the third quarter and 3.8% in the second, and was significantly lower than the government’s initial estimate of 1.4%. Economists had expected the revision to show stronger growth instead of a downgrade, per AP, as quoted on Yahoo Finance.

For the full year 2025, the economy grew 2.1%, slightly below the initial estimate of 2.2%. The pace also slowed compared with 2.8% growth in 2024 and 2.9% in 2023, indicating a gradual cooling in economic momentum.

Consumer Spending and Investment Ease

Consumer spending, the largest component of the economy, rose at a 2% annual pace in the fourth quarter, slowing from 3.5% growth in the third quarter and below the earlier estimate of 2.4%, per the above-mentioned source.

Business investment excluding housing increased at a 2.2% rate, likely supported by spending on artificial intelligence technologies. However, this was weaker than the 3.2% growth recorded in the previous quarter and below the 3.7% increase initially estimated.

Iran Conflict Hurts Consumer Sentiment

Rising geopolitical tensions and higher fuel costs have also affected consumer confidence. A preliminary reading of the University of Michigan’s Index of Consumer Sentiment showed the gauge falling to 55.5 in March, down 1.9% from February and below last year’s level of 57.

The reading also came in below economists’ expectations of 54.8, marking the lowest level so far this year, as quoted on Yahoo Finance. The survey, conducted between Feb. 17 and March 9, was partially completed before U.S.–Israeli strikes on Iran began.

Market Warnings Echo 2007–2008 Crisis: Stagflation Risks Ahead?

The surge in oil prices and growing stress in private credit markets are drawing comparisons to the period preceding the global financial crisis, according to Bank of America strategist Michael Hartnett, per Bloomberg, as quoted on Yahoo Finance. Hartnett noted that oil prices surged from $70 per barrel in July 2007 to $140 by August 2008, coinciding with the early stages of the subprime mortgage crisis.

The Iran war, which began on Feb. 28, has already pushed oil prices more than 60% higher this year. Hartnett warned that current market behavior is increasingly resembling the 2007–2008 period, as mentioned on the above-said Bloomberg article. 

ETFs to Play

Against this backdrop, below we highlight a few exchange-traded funds (ETFs) that could be good picks right now.

Broader Market – State Street SPDR S&P 500 ETF Trust (SPY Quick QuoteSPY - Free Report)

Warren Buffett once reminded shareholders that Berkshire has fallen 50% three times in 60 years and always recovered. Buffett urged investors not to despair in such situations as “America will come back and so will Berkshire shares”. We expect this principle to hold good for several investing modes.

Market crashes are normal. SPY is off 3% this year (as of Mar. 13, 2026). Holding broad S&P 500 ETFs like SPY and VOO should reward investors if held for the long-term.Panic selling kills long-term compounding (read: Buffett's Investing Lessons: What They Mean for ETF Investors).

Copper a Good Bet? – United States Copper Index Fund (CPER Quick QuoteCPER - Free Report)

The ETF CPER is down only 0.5% this year and is down 0.3% over the past one month (as of Mar. 13, 2026). Copper’s potential rally can be driven by long-term fundamentals. Growing demand for electrification — from AI data centers to renewable-energy infrastructure — is expected to outpace supply in the coming years (read: Will 2026 Be a Year of Silver & Copper ETFs?).

Big Tech is Timeless? Roundhill Magnificent Seven ETF (MAGS Quick QuoteMAGS - Free Report)

The famous Magnificent Seven big tech stocks — the leaders of the artificial intelligence revolution — should remain well-positioned over the long term. Concerns about AI payoff timelines or investment spending should not hold them back for long as they are fundamentally strong companies. MAGS ETF is down 8.3% so far this year (as of Mar. 13, 2026), making it an attractive buy-the-dip opportunity.

Importance of Cash Balance – JPMorgan Ultra-Short Income ETF (JPST Quick QuoteJPST - Free Report)  

Buffett normally focused on the company’s strong cash reserves. He cautioned against making investments merely to reduce the cash pile. Investors thus can play the cash-like ETF JPMorgan Ultra-Short Income ETF (JPST Quick QuoteJPST - Free Report)  in uncertain investing times or when value is hard to find elsewhere. The JPST ETF is off 0.2% this year (as of Mar. 13, 2026) and yields 4.37% annually. It charges 18 bps in fees.

Don’t Overlook Emerging Markets – iShares MSCI Emerging Markets ETF (EEM Quick QuoteEEM - Free Report)

Investors should not ignore emerging markets, which include several commodity-rich nations as well as major economies like China. Commodities are currently in a sweet spot. While EEM is up only 1.0% this year, the fund could benefit from a potential commodity boom.

The fund has significant exposure to China, and the iShares China Large-Cap ETF (FXI Quick QuoteFXI - Free Report) is down about 9% this year (as of Mar. 13, 2026). China’s policy stimulus and AI development could quickly shift market sentiment.