Daily Brief - March 13, 2026 (Morning)

 ## Pre-Market Overview U.S. stock futures are showing signs of stabilization after a recent bout of losses, suggesting a cautiously positive open for the market today. Despite the S&P 500, Nasdaq 100, Dow Jones, and Russell 2000 all closing lower yesterday, futures indicate some recovery as traders digest mixed economic data and geopolitical tensions. Overnight, Asian markets have been pressured by ongoing concerns over the Middle East conflict, which continues to impact global oil supplies and inflation expectations. European stocks are also poised to open lower amid energy worries and weak industrial production data from the Eurozone, adding to the cautious sentiment. The U.S. economic backdrop remains mixed, with the latest GDP growth revised down to a tepid 0.7% in Q4 and sticky core inflation readings, keeping the Federal Reserve's policy outlook uncertain. The major overnight development is the surge in oil prices above $100 per barrel, driven by escalating tensions in the Strait of Hormuz and Iran-related geopolitical risks. This is fueling inflation fears and complicating the market's expectations for future Fed rate cuts. Meanwhile, Bitcoin and Ethereum have gained over 3%, signaling some risk-on appetite in crypto markets despite broader equity weakness. ## Top Stories Moving Markets - **Adobe ($ADBE)** reported Q1 earnings with a revenue acceleration but announced a $75 million settlement to resolve a U.S. lawsuit over fees and subscription cancellations. The stock plunged nearly 10% in pre-market trading, reflecting investor concerns over legal risks and CEO transition uncertainties. Adobe’s performance and legal issues will weigh on tech sentiment today. - **Oil prices** surged 6.4% to $114.98 per barrel amid ongoing disruptions in the Strait of Hormuz and renewed U.S.-Iran tensions. This spike is the largest oil market event in decades, according to BMO, and has triggered a rotation into energy and commodity stocks. The energy sector ETF ($XLE) gained 1.02%, positioning energy stocks as today's market leaders. - **El Pollo Loco Holdings ($LOCO)** beat Q4 earnings estimates with adjusted EPS of $0.25 versus $0.20 expected and sales slightly above forecasts. The company also received a buy rating upgrade with a $14 price target. Shares jumped 6% pre-market, making it a notable outperformer in consumer discretionary despite the sector’s overall weakness. - **Schwab ($SCHW)** reported strong net new assets of $32.5 billion in February, signaling robust client inflows and confidence in the brokerage. This positive development contrasts with broader financial sector weakness and may provide support for financial stocks today. - **Meta Platforms ($META)** shares slipped nearly 4% after reports of a delayed launch for its revamped AI model. This setback raises questions about Meta’s AI competitiveness amid a volatile tech environment and could weigh on broader tech sector sentiment. ## Stocks to Watch Today - **$ADBE** - Shares down nearly 10% after Adobe’s $75 million legal settlement and CEO transition news. Watch for tech sector impact. - **$LOCO** - Q4 earnings beat and buy rating upgrade drive a 6% pre-market gain. - **$SCHW** - Strong February asset inflows highlight resilience in the financial sector. - **$META** - Shares fall on AI model delay, signaling potential headwinds for tech. - **$AMAT** - Dividend raised from $0.46 to $0.53 per share, positive for semiconductor investors. - **$CF** - Fertilizer and chemical stocks rally amid supply concerns from Middle East conflict. - **$MOS** - Surged 8.36% on fertilizer supply disruption themes. - **$CRMT** - Shares plunged over 21% after earnings miss, signaling caution in retail auto finance. - **$AFYA** - Q4 earnings beat EPS estimates by 24%, but shares down slightly. - **$JYNT** - Jumped 4.58% on positive earnings call transcript. - **$PCOR** - Shares up 3.71% following strong earnings call. - **$SVCO** - Surged 12.68% on takeover interest and strong earnings. ## Sector Setup - **Technology:** Negative bias as major names like Adobe and Meta face setbacks. The XLK ETF dropped 1.21%, pressured by legal and AI delays. - **Energy:** Positioned for gains with oil prices surging above $100. XLE gained 1.02%, supported by geopolitical supply risks. - **Financials:** Mixed outlook. Despite sector weakness, Schwab’s strong asset inflows provide a bright spot. XLF down 1.07%. - **Consumer Discretionary:** Weakness persists amid broader market risk-off, but El Pollo Loco’s earnings beat offers a rare bright spot. XLY fell 1.78%. ## Economic Calendar & Fed Key economic data released yesterday showed U.S. Q4 GDP growth revised down to 0.7%, missing expectations and signaling a slowing economy. Core PCE inflation held steady at 3.1%, matching forecasts and suggesting inflation remains sticky. Housing starts jumped 7.2% in January, beating forecasts, while building permits declined slightly. Today, no major economic releases are scheduled. However, traders will closely monitor market reactions to the inflation data and geopolitical developments as they assess Fed policy expectations. The Fed’s preferred inflation gauge showing persistent inflation reduces the likelihood of near-term rate cuts, keeping markets on edge. ## Crypto & Commodities Bitcoin climbed 3.26% to $72,828, and Ethereum rose 3.62% to $2,148, showing resilience amid equity market weakness. This suggests some investors are rotating into crypto as a potential alternative or hedge. Gold fell 1.26% to $470.22, pressured by rising oil prices and a stronger dollar. Oil surged 6.41% to $114.98 per barrel, reflecting heightened geopolitical risk and supply concerns from the Middle East conflict. This oil rally is a major driver of inflation worries and market volatility. ## Trading Game Plan - Monitor energy stocks closely as oil prices remain elevated due to Middle East tensions. Favor **$XLE**, **$CF**, and **$MOS** for potential upside. - Exercise caution in technology sector, especially with **$ADBE** and **$META** facing headwinds from legal issues and AI delays. - Watch financials for mixed signals; strong inflows at Schwab may offer selective opportunities despite sector weakness. - Keep an eye on consumer discretionary for isolated earnings beats like El Pollo Loco, but remain cautious given broad sector weakness. - Track crypto markets for risk sentiment shifts, as Bitcoin and Ethereum gains may signal rotation out of equities. - Stay alert to geopolitical developments in the Strait of Hormuz and Iran, as these will continue to influence oil prices and inflation expectations. - Upcoming earnings to watch include Afya ($AFYA), Douglas Elliman ($DOUG), and VEON ($VEON), which have recent or imminent reports that could impact their sectors. - No major economic releases today, but ongoing inflation data and Fed commentary remain key risk factors for market direction.