Market Data as of Week Ending: 3/20/2026 unless noted otherwise
Broad-based selling defined the week as equity markets absorbed a hawkish tilt from the Federal Reserve and continued uncertainty around the conflict in the Middle East. Growth trailed value at both the large and small-cap level, though mid-caps were the exception as growth edged out value by a slim margin. Among size segments, mid-caps held up best, with large caps lagging both mid- and small-caps. Energy was the standout exception among S&P 500 sectors, gaining 2.75% as oil prices remained elevated on supply concerns tied to the Iran war. On the other end, Utilities, Materials, Consumer Staples and Health Care were all down sharply, with Utilities losing nearly 5% on the week. Developed international stocks fell more than domestic equities, while emerging markets held up comparatively well.
Bonds declined across the board as yields rose on the week. Long-duration government bonds were the hardest hit, while short-duration corporate bonds and high-yield bonds outperformed. The 10-yr Treasury yield ended the week at 4.39% and the 2-yr at 3.88%, continuing a trend of rising rates that has pressured fixed income since the start of the month. The yield curve flattened modestly, with the 2-10 slope at 51 basis points. Investment-grade corporate yields and high-yield bonds moved higher to 5.23% and 7.65%, respectively.
The week’s economic focus centered on Wednesday’s FOMC meeting, where members voted 11-1 to hold the federal funds rate at 3.50% to 3.75%. The updated Summary of Economic Projections showed modest upward revisions to both GDP and inflation forecasts for 2026, with the committee revising its inflation outlook higher, projecting PCE at 2.7% for 2026. The dot plot median still projects one rate cut this year, though the internal distribution shifted slightly more hawkish than the headline suggests. In his press conference, Powell acknowledged that the conflict in the Middle East introduces uncertainty on both growth and inflation that the committee will continue to monitor closely. The Fed’s decision to revise its inflation forecast higher was supported by Wednesday’s PPI release, which showed producer prices rising significantly more than expected in February. Headline PPI increased 0.7%, driven higher by a 1.1% increase in goods and a 0.5% increase in services. Other releases for the week were generally constructive, with industrial production and jobless claims both coming in above expectations, though regional manufacturing surveys sent mixed signals heading into April.