Good Afternoon. Stocks slid across the board after February's PPI came in scorching hot — the biggest monthly jump since 2023 — and the Fed kept rates unchanged while offering zero relief on the inflation outlook. Meanwhile, oil rose toward $110 after strikes struck Iran's crown jewel: the South Pars gas field. It's the kind of day that makes you appreciate a boring 401(k) allocation.

—Rosie, Wyatt, Evan & Conor

🔥 What’s Hot: 🔥

🥶 What’s Not: 🥶

1. The Fed Holds Rates and Says "One Cut" Is Still the Plan — Markets Aren't Buying It

The News: The Federal Reserve voted 11-1 to hold rates steady at 3.5%–3.75%, exactly as expected. The updated dot plot maintained the median projection of one 25-basis-point cut in 2026 — unchanged from December. Chair Powell acknowledged "uncertain" impacts from the Iran war and noted that energy-driven inflation adds complexity, but stopped short of signaling any urgency to act in either direction.

Why It Matters: The Fed is stuck. Inflation is running above target, oil is at $109, and the labor market is cooling but not collapsing. That's a recipe for inaction — and markets hate ambiguity. For investors, the message is clear: don't expect rate relief anytime soon. The one projected cut could easily become zero if energy prices stay elevated through summer.

What to Watch: Powell's comments on whether energy inflation is "transitory" or structural. Also watch the political drama: the ongoing subpoena of Powell by the administration adds an unprecedented layer of uncertainty around Fed independence.

Source: CNBC

2. PPI Comes in Scorching Hot — the Biggest Jump Since 2023

The News: The Producer Price Index surged 0.7% in February, the largest monthly increase since August 2023 and well above the 0.5% consensus estimate. Year-over-year, wholesale inflation hit 3.4%. The culprits are everywhere: diesel fuel up 13.9%, fresh vegetables up 48.9%, food prices up 2.4%, and energy goods up 2.3%. Core PPI (ex-food, energy, and trade) rose 0.5% for the tenth consecutive monthly increase.

Why It Matters: PPI is the "upstream" inflation gauge — what businesses pay before passing costs to you. A 0.7% monthly jump tells you the inflation pipeline is filling up fast, mostly thanks to oil and food prices. For the Fed, this report is deeply inconvenient: it arrived on the same morning they were crafting their "we're patient" messaging. For consumers, brace for higher grocery and transportation bills in the weeks ahead.

What to Watch: Next month's CPI will tell us how much of this producer-level pain is reaching consumers. Diesel at $5 and vegetables up 49% aren't staying in the wholesale lane for long.

Source: Bureau of Labor Statistics

3. Oil Barrels Toward $110 After U.S. and Israel Strike Iran's Crown Jewel Gas Field

The News: Brent crude surged more than 5% to nearly $110 a barrel on Wednesday after U.S. and Israeli forces struck Iran's South Pars gas field — the world's largest natural gas reserve, which Iran shares with Qatar. The strike, reportedly carried out with U.S. approval, has cut off the flow of Iranian gas to Iraq. Iran responded by vowing to "expand its attacks on oil and gas facilities across the Gulf." WTI crude also spiked, trading above $100.

Why It Matters: South Pars isn't just another target — it's the beating heart of Iran's energy economy and one of the most strategically significant gas fields on the planet. Hitting it signals a willingness to go after Iran's economic lifeline, not just its military hardware. For energy markets, this escalation adds a fresh layer of supply risk on top of an already disrupted Hormuz chokepoint. For consumers, higher natural gas and oil prices mean higher everything.

What to Watch: Qatar's response — it shares the South Pars field (called North Dome on the Qatari side) and has already seen its LNG expansion delayed. Also watch whether Iran follows through on its threat to widen attacks on Gulf energy infrastructure.

Source: Fortune

4. Micron Joins the $500 Billion Club — and the Pressure Is On Tonight

The News: Micron Technology crossed the $500 billion market cap threshold at Tuesday's close, joining an exclusive club of just 16 S&P 500 companies. The stock has surged roughly 65% year-to-date and 239% since the start of 2025, driven by insatiable demand for high-bandwidth memory chips used in AI computing. The company reports Q2 earnings after today's close.

Why It Matters: Micron has gone from "boring memory chipmaker" to "AI infrastructure play" in record time. The bull case is straightforward: every AI data center needs enormous amounts of memory, and Micron is one of three companies (alongside Samsung and SK Hynix) that can supply it. But at $500 billion, expectations are sky-high — tonight's earnings need to prove the demand curve hasn't peaked.

What to Watch: Revenue guidance and HBM (high-bandwidth memory) commentary. If Micron signals demand acceleration, the stock has room to run. If it guides conservatively, the entire memory and AI hardware trade could cool off.

Source: MarketWatch

5. General Mills Serves Up a Miss — the Cereal Aisle Is Feeling the Squeeze

The News: General Mills reported Q3 fiscal 2026 earnings on Wednesday, with revenue coming in at roughly $4.49 billion — a 7.2% decline year-over-year. Net earnings attributable to the company dropped to $303 million from $626 million a year ago, a 52% plunge. The company pointed to heavy promotional spending, the divestiture of its North American yogurt business, and unfavorable trade expense timing.

Why It Matters: General Mills is a bellwether for the American pantry. When the maker of Cheerios, Betty Crocker, and Pillsbury is spending aggressively on promotions and still losing volume, it tells you consumers are trading down — choosing store brands over name brands. For investors in consumer staples, the "defensive stock" pitch gets harder to make when margins are compressing this fast.

What to Watch: Whether the competitive promotional environment intensifies as food inflation accelerates. With diesel at $5 and PPI food prices jumping 2.4%, input costs are rising just as consumers are getting more price-sensitive.

Source: Yahoo Finance

1. Iran Fires Cluster Missiles at Israel — Two Killed in Ramat Gan

The News: Iran launched a retaliatory missile barrage at central Israel late Tuesday and into Wednesday, using cluster-warhead missiles designed to evade air defenses. Two civilians — Yaron and Ilana Moshe, a couple in their seventies — were killed in their apartment in Ramat Gan, near Tel Aviv, after apparently not reaching their safe room in time. Shrapnel damaged one of Tel Aviv's main train stations, temporarily halting rail service. Additional waves of missiles followed Wednesday morning.

Why It Matters: This is the deadliest Iranian strike on Israeli soil since the war began three weeks ago, and the use of cluster munitions represents a troubling escalation in weapons sophistication. For markets, every time missiles reach central Israel, the risk premium on oil, gold, and defense stocks ticks higher. The question now: does this cycle of assassination-and-retaliation have an off-ramp, or are we heading toward a broader regional war?

What to Watch: Israel's next response. Defense Minister Katz has already signaled expanded IDF operations in Lebanon to push back Hezbollah, which opens a potential second front that could further destabilize the region.

Source: Al Jazeera

2. The U.S. and Israel Hit South Pars — and Now Iran's Gas Lifeline to Iraq Is Cut

The News: A coordinated U.S.-Israeli airstrike hit Iran's South Pars gas field — the world's largest natural gas reserve, responsible for a massive share of Iran's energy exports. The strike, reportedly carried out with explicit U.S. approval, has severed the flow of Iranian natural gas to Iraq. Iran's state media also reported that a projectile struck near the Bushehr Nuclear Power Plant, though the IAEA said no damage or injuries were reported there.

Why It Matters: Targeting South Pars crosses a new threshold. This isn't a military base or a missile site — it's Iran's economic backbone and a field shared with Qatar, whose own North Dome expansion has already been delayed to mid-2027. For global energy markets, the strike simultaneously reduces Iranian supply and raises the specter of damage to the broader Gulf gas network. European natural gas prices climbed as much as 1.8% on the news.

What to Watch: Whether Iraq, which depends on Iranian gas for a significant portion of its electricity generation, faces blackouts. Also monitor whether Qatar escalates its diplomatic pressure on Washington.

Source: Bloomberg

3. Iran Vows to "Expand Attacks" on Gulf Energy — and Saudi Arabia Is Intercepting 100 Drones a Day

The News: Following the South Pars strike and the killing of Ali Larijani, Iran's IRGC announced it will expand attacks on oil and gas facilities across the Gulf region. Saudi Arabia reported intercepting nearly 100 Iranian drones in 24 hours — the highest single-day total of the conflict. Kuwait, Qatar, and the UAE have all reported fresh attacks this week. Iraq is now routing some oil exports via a pipeline through Turkey to bypass disrupted Gulf shipping.

Why It Matters: The war is no longer just about the Strait of Hormuz — it's about the entire Gulf energy corridor. Iran's strategy of hitting every neighbor that hosts a U.S. base is designed to make the war too expensive for the coalition to sustain. For energy traders, the "worst-case" scenarios from two weeks ago are becoming baseline assumptions. For governments, the math is brutal: defend your infrastructure or pressure Washington for an exit.

What to Watch: Iraq's Turkey pipeline capacity and whether other nations follow suit with alternative export routes. If Gulf states publicly break with Washington, the political dynamics of the war shift dramatically.

Source: AP News

Q: What do you call an elephant that doesn't care?

A: An irrelephant.

Describes a monetary policy stance that favors higher interest rates, tighter financial conditions, and prioritizing inflation control over economic growth — the opposite of "dovish."

"With PPI running hot and oil near $110, the Fed's tone today was notably more hawkish than January's — Powell made it clear that rate cuts aren't coming until the inflation picture meaningfully improves."

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