White House & Policy - February 28, 2026 (Morning)

 ## Policy Overview The administration has escalated tensions in the Middle East with coordinated U.S. and Israeli strikes on Iran overnight. These military actions mark a significant shift in foreign policy, signaling a more aggressive stance toward Iran’s regime. The president is expected to address the nation this morning to outline the rationale behind these strikes and the administration’s broader strategy in the region. This speech will be closely watched by markets for clues on the duration and intensity of the conflict. No new executive orders or regulatory actions were announced overnight. However, the geopolitical escalation is dominating policy sentiment, overshadowing other legislative developments. There are no major congressional hearings or votes scheduled today directly related to this conflict or other policy issues, but lawmakers are expected to respond in the coming days, which could influence market sentiment. ## Market Impact Pre-market futures are reflecting heightened risk aversion amid the Iran strikes. The Dow Jones futures are down over 1%, with the S&P 500 and Nasdaq 100 futures also trading lower. The Russell 2000 is under particular pressure, down 1.72%, indicating small caps are more sensitive to geopolitical risk. Energy sectors are rallying sharply as oil prices surge 2.73% to $81.95 per barrel, reflecting concerns over supply disruptions in the Middle East. The Energy Select Sector SPDR (XLE) is up 1.58%, benefiting from the geopolitical risk premium. Conversely, Financials (XLF) and Technology (XLK) sectors are under pressure, down 2.04% and 1.60%, respectively, as investors move away from riskier assets amid uncertainty. The U.S. dollar is slightly weaker, with the UUP ETF down 0.07%, as safe-haven demand is split between the dollar and gold. Gold prices have risen 1.31% to $483.75 per ounce, reflecting traditional safe-haven buying. Long-term Treasury prices are higher, with the 20+ Year Treasury ETF (TLT) up 0.55%, indicating a flight to quality and expectations of potential risk-off sentiment. Cryptocurrency markets are also reacting negatively, with Bitcoin down 1.51% to $64,871.40, reflecting broader risk-off sentiment. ## Winners & Losers ### Potential Winners **$XOM** - Higher oil prices and geopolitical risk in the Middle East boost energy producers’ outlook. **$CVX** - Similar to ExxonMobil, benefits from rising crude prices and supply concerns. **$APA** - U.S. oil producers stand to gain from increased demand and potential supply constraints. **$LMT** - Defense contractors likely to see increased demand amid heightened military activity. **$RTX** - Raytheon Technologies benefits from increased defense spending and conflict-related contracts. **$NOC** - Northrop Grumman positioned to gain from defense sector tailwinds. ### Potential Losers **$XLF** - Financials hit by risk aversion and banking sector volatility amid geopolitical uncertainty. **$MS** - Morgan Stanley shares down 6.20%, reflecting broader financial sector weakness. **$GS** - Goldman Sachs down 7.48%, impacted by risk-off sentiment and banking sector concerns. **$AIZ** - Insurance stocks face pressure amid uncertainty and potential claims related to conflict. **$U** - Unity Software down 7.35%, reflecting tech sector selloff amid risk-off moves. **$NVDA** - Nvidia shares down 3.83%, pressured by broader tech selloff despite strong earnings. ## Sector Exposure - **Energy:** The Middle East conflict is driving oil prices higher, benefiting exploration, production, and services companies. Expect continued volatility in this sector as markets price in supply risks. - **Defense:** Increased military activity and geopolitical tensions are boosting defense contractors, with expectations of higher government spending and contract awards. - **Financials:** Banking and financial services sectors are under pressure due to risk aversion and concerns about economic disruption from geopolitical instability. - **Technology:** Tech stocks are facing selling pressure amid broader market risk-off and concerns about AI-driven economic disruption, compounded by geopolitical uncertainty. ## What to Watch Today - The president’s scheduled address this morning on the Iran strikes will be the key policy catalyst. Markets will parse the tone for indications of escalation or de-escalation. - Oil prices and energy stocks will remain volatile as traders assess supply risks from the Middle East. - Watch for any congressional statements or responses that could influence market sentiment on defense spending or sanctions. - Monitor Treasury yields and gold prices for signs of safe-haven flows and risk appetite shifts. - Keep an eye on financial sector earnings and guidance for any impact from geopolitical risk and market volatility. In summary, geopolitical developments are the dominant policy driver for today’s trading session. Energy and defense sectors are poised for gains, while financials and technology face headwinds. The president’s remarks and ongoing conflict developments will be critical market-moving events.