Just caught the market action from earlier this week and it's pretty wild what geopolitical tensions can do to the broader tape. Stocks took a real hit with the S&P 500 dropping nearly 1%, Nasdaq sliding over 1%, and the Dow following suit. We're talking 3-month lows across the board here.

The Iran situation is the elephant in the room. As the conflict stretched into its fourth day with no signs of cooling off, energy markets went haywire. WTI crude spiked over 4% to hit 8.5-month highs, and there's this real concern about what happens if the Strait of Hormuz gets disrupted—that channel handles about a fifth of global oil supply. Goldman Sachs is pricing in an $18 per barrel risk premium based on a potential six-week shutdown scenario.

What's interesting is how Trump's announcement about providing maritime insurance and naval escorts actually helped pull things back from the worst levels. Crude retreated from its highs, stocks recovered some losses, but the damage was already done by then.

The energy shock rippled everywhere. European natural gas prices exploded over 22% to 3-year highs after Qatar shut down its Ras Laffan facility—that's roughly 20% of global LNG supply offline. Plus there was a fire at UAE's Fujairah oil hub from intercepted drone debris. This is serious supply chain stuff.

On the equity side, the selloff was pretty selective. Chipmakers got hammered—SanDisk down 8%, Micron off 7%, and basically the entire semiconductor complex was red. Mining stocks collapsed too, with gold down 3% and silver down 6%, so names like Hecla Mining and Coeur Mining took double-digit hits. Even crypto-exposed plays like Mara and Riot slid on Bitcoin weakness, which dipped just under 1%.

But here's where it gets interesting—software stocks actually rallied. Workday led the S&P with a 7% gain, and you had Adobe, ServiceNow, and Microsoft all moving higher. That defensive rotation made sense given the uncertainty.

Earnings season is wrapping up with over 90% of S&P 500 companies having reported. The numbers have been solid—73% of reporters beat expectations, and Q4 earnings growth is tracking at 8.4% year-over-year. Excluding the Magnificent Seven, we're still seeing 4.6% growth, which is respectable. Some notable misses though: MongoDB guided lower on 2027 revenue, Sea Ltd disappointed on Q4 net income, and Surgery Partners came in well below consensus on full-year guidance.

On the macro front, bond yields climbed as inflation concerns spiked. The 10-year hit 4.054%, and the breakeven inflation rate jumped to 2.318%. Fed speakers are getting hawkish about this—Kansas City's Schmid basically said they can't afford to be complacent on inflation after nearly five years above target. That's not the tone you want to hear if you're hoping for rate cuts.

European markets got hit even harder—Euro Stoxx 50 fell 3.59%, Japan's Nikkei dropped 3%, and China's Shanghai Composite fell 1.43% from recent highs. The Eurozone inflation data came in hotter than expected too, which is pressuring ECB rate cut expectations.

Looking ahead, we've got ADP employment data Wednesday, ISM services Friday, and the big nonfarm payrolls report coming. Markets are only pricing in a 2% chance of a 25 bp rate cut at the mid-March Fed meeting, so expectations are pretty anchored. The real question is whether this geopolitical premium sticks around or if we get some de-escalation that lets the market breathe. Either way, energy stocks and commodities are going to stay in focus—this isn't just a one-day story.