Weekly Market Update – March 6, 2026

Quick Takes

• Capital markets across the world fell in a turbulent week marked by rising geopolitical tensions and a surprisingly weak jobs report that rattled markets. Investors were forced to contend with the prospect of stagflation from weaker labor markets and rising oil prices.
• All three major U.S. indexes fell for the week with the S&P 500 off -2.0%, the Nasdaq Composite down -1.2%, and the small-cap Russell 2000 dropping -4.1%. Non-U.S. stocks were even worse with the MSCI EAFE Index sinking -6.8% and the MSCI Emerging Markets Index plunging -6.9%.
• The bond market saw steep declines as yields were sharply higher. The 2-Year and 10-Year Treasury yields were up +19 and +20 basis points, respectively. The Bloomberg U.S. Aggregate Bond Index fell -1.0%, while the Bloomberg Global Aggregate ex U.S. Index tumbled -2.4%.

Source: Bloomberg. Data as of March 6, 2026.
Price Returns for Equity, Total Returns for Bonds.
* The term basis points (bps) refers to a common unit of measure for interest rates and other percentages in finance. One basis point is equal to 0.01%. Bond prices and bond yields are inversely related. As the price of a bond goes up, the yield decreases.

Global Markets Slide as Oil Surges and Weak Jobs Report Fuels Stagflation Fears

Capital markets across the world closed out a turbulent week in the red as rising geopolitical tensions and a surprisingly weak jobs report rattled markets. Investors were forced to grapple with a troubling combination: surging energy prices, slowing job growth, and rising bond yields—a mix that revived fears of stagflation, the unwelcome pairing of sluggish growth and stubborn inflation. Below is a look at how the week unfolded across stocks, bonds, and the broader economy.

U.S. Stocks: A Tough Week Amid Oil Spike and Weak Jobs Data

U.S. markets tumbled after an escalation in the Middle East involving the U.S., Israel, and Iran sent crude oil prices soaring. Oil jumped 12.2% on Friday alone, closing at $90.90 a barrel, its biggest one-day increase since May 2020. For the week, crude finished up 36%, putting fresh upward pressure on energy inflation—exactly what the Federal Reserve doesn’t want to see right now.

The selloff deepened when Friday’s jobs report showed the economy lost 92,000 jobs in February, sharply missing expectations for a 60,000 gain. The unemployment rate also rose to 4.4% from 4.3%. That weakness clashed with the inflationary signal from rising energy prices, creating a difficult backdrop for the Fed.

All three major U.S. indexes fell for the week:

• S&P 500: -2.0%
• Nasdaq Composite: -1.2%
• Russell 2000 (small-caps): -4.1%

Defensive sectors held up best, with Consumer Staples eking out a +0.3% gain. Consumer-focused companies struggled, with Consumer Discretionary stocks sliding -2%.

Retail sales in January fell -0.2%, better than expectations for a much steeper drop, though winter storms and weaker auto sales weighed on activity.

International Stocks: A Global Rout With Nowhere to Hide

After months of outperformance relative to U.S. stocks, international markets were hit even harder than their domestic counterparts last week.

Developed-market stocks, tracked by the MSCI EAFE Index, had their worst week since April 2025, plunging -6.8% and snapping a 14-week winning streak. Major regions including Europe, the U.K., and Japan all fell between -6% and -7%.

Emerging markets suffered even deeper losses:

• MSCI Emerging Markets Index: -6.9% (worst since March 2020)
• MSCI Latin America Index: -7.9% (worst since Feb. 2021)
• MSCI China Index: -3.0%

A strengthening U.S. dollar—up +1.4% for the week, its largest gain since August 2025—created an additional headwind for global returns.

Bonds: Yields Jump, Adding Pressure Across Markets

The bond market saw steep declines as geopolitical tensions and hotter-than-expected manufacturing price data pushed yields sharply higher.

The ISM Manufacturing Prices index jumped more than expected in February, reinforcing concerns that inflation pressures remain alive. Treasury yields responded in force:

• 2-Year Treasury yield: +19 basis points to 3.56%
• 10-Year Treasury yield: +20 basis points to 4.14% (highest since early February)
• 30-Year Treasury yield: up +3.2% for the week

The broad Bloomberg U.S. Aggregate Bond Index fell -1.0%, its worst week since April 2025. International bonds fared even worse, with the Bloomberg Global Aggregate ex-U.S. Index tumbling -2.4%, the sharpest decline since September 2022.

Economics: Mixed Signals as Labor Weakens but PMI Activity Expands

While the headline jobs report disappointed sharply, other economic indicators were more encouraging. The ISM Manufacturing PMI rose to 52.4 in February, posting a second consecutive month of expansion and only the third reading above 50 in the past 40 months. The ISM Services PMI also surprised to the upside, climbing to 56.1, its strongest level since July 2022 and the 20th straight month of expansion.

Private-sector hiring showed some resilience, with 63,000 new jobs added in February—better than the 43,000 expected and a pickup from January’s modest 11,000. Layoffs also fell sharply: employers announced 48,000 job cuts, down from 108,000 the month before.

Still, the combination of a rising unemployment rate and rapidly rising energy prices leaves the Federal Reserve in a difficult position ahead of its March meeting. The uptick in joblessness may push the Fed to maintain a dovish tone, but the inflationary risk from the oil shock makes near-term rate cuts less likely.

The Bottom Line

Geopolitical shocks often cause swift market repricing but don’t always lead to lasting downturns. A faster-than-expected resolution in the Middle East could even help ease long-standing risk premiums over time—though that outcome is far from assured.

For now, investors should expect continued volatility as markets digest uncertainty around global conflict, the inflation outlook, and the Fed’s next steps. 

Chart of the Week

The February Employment Situation Report was a real stinker, a big disappointment following the stellar January report. U.S. employers reported Nonfarm Payrolls fell -92,000 for the month, far below the +55,000 new payrolls Wall Street expected and down sharply from the January +126,000 jobs created (which was revised lower from the originally reported +130,000). And December non-farm payrolls were further revised lower from +48,000 to -17,000. Healthcare jobs, which have propped up the labor market for months, collapsed. A strike in California was partly to blame, but it also highlighted problems in the rest of the market. Private-sector jobs fell by -86,000 and January private sector payrolls were revised lower to 146,000 from 172,000. The Unemployment Rate ticked up to +4.4% from +4.3% in January (unrevised), where it was expected to stay. The Employment-Population Ratio decreased to 59.3% from 59.4% the prior month. The bright spot was Average Hourly Earnings (AHE), which jumped +0.4%, leaving the year-over-year increase at +3.8% versus +3.7% in January, and real earnings on a positive trajectory. On an annual basis, AHE were up +3.8%, above expectations for +3.7% which is where they were the prior month (unrevised). The Fed would like to see wage growth slow to around +3% annually or less, a level it sees as consistent with low inflation.  Average Weekly Hours Worked were steady at 34.3 hours, in line with expectations. November private sector payrolls increased by +37,000, down from 50,000 the month before after being revised down from +69,000, and well short of expectations for +75,000. The Labor-Force Participation ticked down to 62.0% versus 62.1% the prior month. The bottom line is that the February employment report was a big disappointment that muddies the water for the Fed, with higher inflationary aspects and lower employment job growth—the wrong direction each of its two mandates.

February Payrolls Unexpectedly Fell by -92K; Unemployment Rate Rises to 4.4%

U.S. Monthly Job Creation in the U.S. (Jan. 2022 – Feb. 2026)

Source: Bureau of Labor Statistics (BLS) via FRED, CNBC.

The Week Ahead

Inflation is the name of the game this week. The Bureau of Labor Statistics (BLS) releases the Consumer Price Index (CPI) for February on Wednesday. On Friday, the BLS will also release the Personal Consumption Expenditures (PCE) Price Index for January, which was delayed by the partial government shutdown. Other economic data next week include the National Federation of Independent Business’ Small Business Optimism Index for February on Tuesday and the BLS’ Job Openings and Labor Turnover Survey (JOLTS) for January on Friday. Also out on Friday is the University of Michigan’s Consumer Sentiment Index for March.

 The earnings tap has slowed to a trickle, but Oracle, Hewlett Packard Enterprise, Adobe, Dollar General, and Lennar are among the key firms reporting results next week.

Did You Know?

GETTING LESS GREEN – Pay growth for job-changers, which is typically faster than for job-stayers, rose +6.4% year- over-year in January, tied for the slowest pace since February 2021. The spread between job-changer and job-stayer pay growth also narrowed to its tightest since ADP began tracking the data in 2020. (Source: ADP)

BACK TO THE 5’S – After peaking above +8% in October 2023, the average rate on a 30-year mortgage fell below 6% last week, the lowest level since September 2022. The drop resulted in a 130% surge in applications to refinance a home loan, according to the Mortgage Bankers Association. (Source: CNBC)

NEW BIZ JUMPS – New business formations in the U.S. have surged since COVID and hit their third highest level ever in January. From 2004 to 2019, an average of 230k new businesses (EID registrations) were started each month. That average has jumped to 435k per month since 2020 and hit 532k (seasonally adjusted) in January. (Source: US Census)

This Week in History

AN ASPIRIN A DAY – On March 6, 1899, German company Bayer trademarked its name for a new wonder drug it called aspirin. (Source: The Wall Street Journal)

Economic Review

• The ISM Services PMI was 56.1% in February, up from 53.8% the prior month (unrevised). That is the 20th consecutive month in expansion and beat expectations to dip to 53.5%. Service-oriented companies, such as restaurants and retailers, employ the majority of Americans. The New Orders jumped to 58.6% from 53.1% the prior month and the Production component rose to 59.9% from 57.4%. The Employment component improved to 51.8% from 50.3%. The Supplier Deliveries index decreased to 53.9% from 54.2% but the Backlog of Orders component surged to 55.9% from 44.0%. The Prices index fell to 63.0% from 66.6%. Overall, the report showed that growth in the important service sector economy accelerated further in February, and unlike the manufacturing sector, the Prices index decelerated.  
• The Institute for Supply Management’s (ISM) Manufacturing PMI was 52.4% in February, just a bit lighter than the 52.6% put up in January (unrevised), which was the best level since August 2022. The February rate was above Wall Street consensus expectations for it to rise to 51.5%. That is now two straight months solidly above 50%, following 11 consecutive months below 50.0% (above 50% indicate economic expansion, levels below 50% indicate contraction).  New Orders, a sign of future demand, dipped to 55.8%, after surging to 57.1% the prior month, which was the highest since February 2022. The Production index fell to 53.5% from 55.9% in January. The New Export Orders index inched up to 50.3% from 50.2%. The Employment index rose to 48.8% from 48.1%. On the downside, the Prices index, a measure of inflation, surged to 70.5% from 59.0%, which is the highest level since June 2022. The key takeaway from the report is that manufacturing activity was surprisingly strong, but the spike in the Prices index will fuel concerns about stubborn inflation.
• The S&P Global US Services PMI ticked down in February to 51.7 from 52.7 the prior month and was light from the preliminary reading two weeks ago of 52.3. That marks the weakest pace of expansion in 10 months, but still extended the streak above the key 50.0 expansion level to 37 months. The Business Activity Index signaled only a modest increase in output, consistent with the overall slowdown. Firms cited adverse weather and softened demand as key drags on activity. New Orders expanded for a 22nd straight month, but at a slower rate. Employment growth improved fractionally as firms were able to fill existing vacancies, but cost–cutting efforts held back broader hiring. Inflationary pressures in the service sector, meanwhile, remain elevated. Input Costs accelerated, led by higher labor expenses and tariff–related cost pressures. Output Prices rose at a faster pace, reflecting the pass–through of elevated costs to customers. Business Confidence improved from January, supported by tax breaks and better sentiment, but remained below long–run trends due to uncertainty around government policy and tariffs.
• The final reading for the S&P Global US Manufacturing PMI fell to 51.6 in February, down from 52.4 the month before. That was up from the 51.2 flash estimate two weeks ago but marked the weakest growth in seven months. It still signaled expansion for the seventh consecutive month. Output (Production) grew, but at the softest pace since September, weighed down by high prices, tariffs, and extreme weather conditions. New Orders increased, but only marginally, with overall demand constrained by elevated costs and policy uncertainty. Export Orders fell for an 8th straight month and at the sharpest rate since April 2025. Employment growth was muted, with manufacturers showing restraint in hiring due to softer demand. Inflationary pressures remain, with Input Prices driven by tariffs and rising materials costs, though still below 2025 peak levels. However, Output Prices eased to a 14-month low, as competition limited companies’ ability to pass higher costs to customers. Confidence in the Outlook reached its highest level in eight months, pointing to improved sentiment for the year ahead despite tariff and weather–related challenges.
• The Commerce Department reported that the advance read on U.S. Retail Sales for January fell -0.2%, versus Wall Street expectations for them to fall -0.3%, and down from flat reading the prior month (unrevised). Retail sales represent about one-third of all consumer spending and offer clues on the strength of the economy. Retail Sales Ex-Autos were unchanged for a second straight month, matching expectations. Sales Ex-Autos and Gas were up +0.3%, above expectations for a +0.2% rise and up from the prior month’s +0.1% gain (after being revised up from 0.0%). The Control Group, a figure used to calculate Gross Domestic Product (GDP), rose +0.3%, in line with expectations and up from 0.0% the prior month (revised higher from -0.1%). The bottom line is that retail sales activity was disrupted by the winter storms, so the result isn’t as disappointing as the headline number looks, particularly when excluding Autos and Gas.
• Outstanding U.S. Consumer Credit increased by $8.1 billion in January (-4.1%), below expectations for a +$12.650 billion increase, and down sharply from $25.204 billion (+5.9%) the prior month (revised up from the initially reported +$24.045 billion). Growth for revolving credit, such as credit cards, increased +4.3% for the month, after jumping +11.3% the previous month. Nonrevolving credit, which tends to be much less volatile than revolving credit and includes auto as well as school loans, rose +1.1% following the prior month’s +4.1% increase. The data from the Federal Reserve is not adjusted for inflation and does not include mortgage loans, which is the largest category of household debt.
• Imports Prices were up +0.2% in January, better than expectations for a+0.3% rise and unchanged from the prior month (after being revised higher from +0.1%). Import Prices ex Petroleum were up +0.4%, lower than expectations for a +0.5% rise, which is what they were the previous month after being revised up from +0.4%. Year-over-year, the cost of imports decelerated -0.1%, better than expectations for a +0.1% increase, and down from the flat annual rate the prior month. Export Prices were up +0.6%, above expectations for +0.2% rise, but matching the prior month’s increase after being revised higher from +0.3%. Export prices accelerated to +2.6% over the past year, down from the +3.4% annual rate reported the previous month (revised higher from +3.1%).
• On Wednesday, the Federal Reserve released its Beige Book, which is a collection of business anecdotes produced eight times a year from the 12 Federal Reserve districts used by policymakers to prepare for their next monetary policy decision. According to the latest book, the U.S. economy got off to a choppy start in 2026. The U.S. economy grew at a mild pace early in the new year with “uncertainty,” higher prices, and severe winter weather holding back growth. Most districts reported little improvement in growth in the first two months of the year. Affordability remained front and center in the minds of consumers. Rising inflation, for instance, led to less spending by lower-income households, the Fed said. The good news? Businesses expected better times ahead. “Overall, economic expectations were optimistic, with most districts expecting slight to moderate growth in the coming months,” the report said. Most businesses remained in a low-hire mode: Seven of the 12 Fed districts that cover the entire country reported no change in employment. Many businesses raised prices “moderately” in January and February as their own costs increased due to tariffs, the Fed said. Yet customers also resisted price increases, forcing some firms to keep prices the same. According to the Fed, “on balance, firms expected prices to rise at a somewhat slower pace in the near term.”
• Weekly MBA Mortgage Applications jumped 11.0% for the week ending February 27, after inching up +0.4% the prior week. The Purchase Index rose +6.1% after falling -4.7% the prior week. The Refinance Index surged +14.3% after rising +4.1% the prior week. The average 30-Year Mortgage Rate remained at 6.09% for a second week, the lowest point in this dataset since September 9, 2022. 
• Weekly Initial Jobless Claims were unchanged at 213,000 for the week ending February 27, which was better than expectations for 215,0000. The prior week was revised higher by +1,000. The number of people already collecting unemployment claims (i.e., Continuing Claims) rose 46,000 to 1,868,000 for the week ending February 21, which was worse than expectations for 1,845,000. The prior week’s reading was revised lower to 1,822,000 from 1,833,000. 

Asset Class Performance

Source: Bloomberg.
Asset‐class performance is presented by using market returns from an exchange‐traded fund (ETF) proxy that best represents its respective broad asset class. Returns shown are net of fund fees for and do not necessarily represent performance of specific mutual funds and/or exchange-traded funds recommended by The Retirement Planning Group. The performance of those funds may be substantially different from the performance of the broad asset classes and to proxy ETFs represented here. US Bonds (iShares Core US Aggregate Bond ETF); High‐Yield Bond (iShares iBoxx $ High Yield Corporate Bond ETF); Intl Bonds (Vanguard Total International Bond ETF); Large Growth (iShares Russell 1000 Growth ETF); Large Value (iShares Russell 1000 Value ETF); Mid Growth (iShares Russell Mid-Cap Growth ETF); Mid Value (iShares Russell Mid-Cap Value ETF); Small Growth (iShares Russell 2000 Growth ETF); Small Value (iShares Russell 2000 Value ETF); Intl Equity (iShares MSCI EAFE ETF); Emg Markets (iShares MSCI Emerging Markets ETF); and Real Estate (iShares US Real Estate ETF). The return displayed as “Allocation” is a weighted average of the ETF proxies shown as represented by 24% US Bonds, 10% International Bonds, 6% High Yield Bonds, 13.8% Large Growth, 13.8% Large Value, 3.6% Mid Growth, 3.6% Mid Value, 1.2% Small Growth, 1.2% Small Value, 16.8% International Stock, 4.2% Emerging Markets, 1.8% Real Estate.
* The term basis points (bps) refers to a common unit of measure for interest rates and other percentages in finance. One basis point is equal to 0.01%. Bond prices and bond yields are inversely related. As the price of a bond goes up, the yield decreases.