Recent geopolitical tensions involving Iran have created understandable concern in the markets. Here’s what we’re watching—and how it may impact your portfolio.
Key Concerns
- Oil Supply Risk: Roughly 20% of global oil flows through the Strait of Hormuz. Any disruption has already pushed oil prices higher.
- Shipping Impact: The region also plays a role in global trade, including fertilizer and container shipping.
- Uncertainty: Ongoing conflict increases volatility and weighs on investor sentiment.
- Inflation Pressure: Prolonged disruption could lead to higher oil and shipping costs, potentially impacting inflation and corporate earnings.
Looking Ahead
- Historically, oil prices tend to stabilize or decline within 6 months following geopolitical shocks.
- Production remains strong: Both U.S. and OPEC production are at elevated levels.
- Strategic reserves: The U.S. and G7 have the ability to release oil to stabilize markets.
- The conflict has not yet impacted GDP or corporate earnings, and economic momentum remains solid.
- Market breadth has been improving in 2026, with growth expanding beyond just the tech sector.
Market Perspective
- We are currently in a market correction, which is normal—pullbacks of ~10% happen every 2–3 years.
- At this time, we do not expect a recession and remain confident in the underlying economy.
- Periods like this often create long-term buying opportunities.
Our Approach
- Stay disciplined and avoid short-term, reactionary decisions
- Maintain diversified portfolios aligned with your goals
- Focus on long-term strategy, not short-term headlines
We are closely monitoring global developments and your portfolios. If our outlook changes, we will communicate proactively.
The views stated in this letter are not necessarily the opinion of Cetera Wealth Services, LLC, and should not be construed directly or indirectly as an offer to buy or sell any securities mentioned herein. Due to volatility within the markets mentioned, opinions are subject to change without notice. Information is based on sources believed to be reliable; however, their accuracy or completeness cannot be guaranteed. Past performance does not guarantee future results.