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*                       FIEND'S SUPERBEAR MARKET REPORT                     *

*                                 March 25, 2026                            *

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*                       e-mail: fiendbear@fiendbear.com                     *

*                    web address: http://www.fiendbear.com                  *

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Fiend Commentary
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The Market Wants Peace, But It Still Has a Bill to Pay

The tone in markets has shifted in a way that would have seemed unlikely just a couple of months ago. Back then, investors were leaning on the “rate cuts are coming” story. Now, the conversation has flipped: rate cuts for 2026 are no longer the base case, and the futures market is even assigning roughly a one-in-four chance of a rate hike by year-end.

That is a remarkable pivot, and it helps explain why the tape feels so jumpy. When the market loses faith in the Fed being an easy backstop, everything becomes more fragile: stocks, metals, credit, and even the “buy the dip” reflex.

Oil was the spark that forced this rethink. Prices fell sharply on renewed ceasefire hopes, but that doesn’t mean the problem is solved. If the conflict drags on, the Strait remains uncertain, and the region stays unstable, then oil doesn’t need to go to $150 to cause damage. It only needs to stay “high enough” for long enough.

And “high enough” could simply mean near $90–$100 instead of last year’s comfort zone. That would still be a major jump for consumers, shipping costs, and business margins. It would also keep inflation pressure alive even if the war de-escalates on paper. Disruption doesn’t unwind instantly. Insurance costs don’t snap back overnight. Supply chains don’t heal with a press release.

This is why the market’s desire for peace may be running ahead of reality. Traders want a clean ending: oil back to $60, inflation rolling over, and the Fed free to cut later this year. But even if the war ends soon, we still have the same underlying economic issues sitting there like unpaid invoices:

1.     Inflation is not fully tamed.

2.     Growth is already wobbling.

3.     Bond yields have risen back toward recent highs anyway.

That third point matters more than people want to admit. When yields rise, it tightens financial conditions automatically. Mortgages don’t get cheaper. Corporate borrowing doesn’t get easier. Government interest costs don’t get smaller. So the “softening economy” story starts to feel more real, even without dramatic headlines.

Which brings us to the Fed and the second quarter.

Powell’s chairmanship is nearing its endpoint, and that creates a strange transition period: markets are trying to guess the next regime while the current one is still in charge. In a perfect world, the Fed would simply follow the data. In the real world, the Fed is trying to protect credibility on inflation while the economy slows and energy prices threaten to reheat the next inflation prints.

So Wednesday’s setup looks like this:

Markets are ready to rally on any sign of peace.
But even peace won’t instantly fix inflation, rebuild confidence, or reset rates.
And if oil stays elevated, the “rate cuts later” story may keep getting pushed further into the future.

That’s why volatility still feels like the default setting. The market is not just trading the war. It’s trading what the war does to inflation, what inflation does to the Fed, and what the Fed does to everything else.

If there’s a single takeaway: a ceasefire headline can calm markets for a day, but it takes sustained normalcy to bring oil and rates back down. Until that happens, investors are going to remain quick to de-risk at the first sign of trouble.

 

 

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