Wall Street Edges Higher as Fed Meeting Begins; European Stocks Gain Despite Oil Above $100

Wall Street Edges Higher as Fed Meeting Begins; European Stocks Gain Despite Oil Above $100

U.S. and European equity markets both closed higher on Tuesday, March 17, 2026, as investors balanced lingering concerns over the Middle East conflict and surging oil prices against renewed interest in travel stocks and easing crash fears. All eyes now turn to the Federal Reserve, which began its two-day policy meeting amid growing uncertainty over how policymakers will navigate inflation risks fueled by the war on Iran.

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U.S. Markets: S&P 500 Up 0.25%, Nasdaq Gains 0.47%

Wall Street ended the session modestly higher on Tuesday, led by a rebound in travel and airline stocks. The three major indexes all finished in positive territory:

Index	Close	Change
S&P 500	6,716.09	+0.25%
Nasdaq Composite	22,479.53	+0.47%
Dow Jones Industrial Average	46,993.26	+0.10%

Eight of the 11 S&P 500 sectors finished higher, led by energy (+1.02%) and consumer discretionary (+1.0%). Trading volume was on the lighter side at 16.9 billion shares, well below the 20-session average of 19.8 billion.

Key Movers

• Delta Air Lines (DAL) surged more than 6% after raising first-quarter revenue guidance, with American Airlines (AAL) gaining 3.5% and United Airlines rising 3.2%.
• Uber (UBER) rallied 4.2% on plans to roll out robotaxis in 28 cities starting next year, powered by Nvidia’s autonomous driving software.
• Financials rebounded: Blackstone (BX) +4.6%, Apollo Global (APO) +5.3%, KKR +3.3%, recovering from sharp recent losses tied to private credit quality concerns.
• Energy stocks: Occidental (OXY) and ConocoPhillips (COP) each rose ~1%, tracking higher crude prices.
• Eli Lilly (LLY) fell nearly 6% after HSBC downgraded the stock to “reduce.”
• Honeywell (HON) dipped 1.3% after warning the Middle East conflict could affect Q1 revenue.

Advancing issues outnumbered decliners by a 1.7-to-1 ratio on the S&P 500. The benchmark posted 21 new 52-week highs and just two new lows.

Source: Reuters — “Wall Street ends up as traders turn to Fed”

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European Markets: STOXX 600 Rises 0.6% as Utilities and Oil Stocks Lead

European equities finished the day broadly higher despite oil prices spiking back above $100 per barrel on lingering Middle East supply fears.

Index	Close	Change
STOXX 600	602.45	+0.67%
Euro STOXX 50	5,769.25	+0.53%
FTSE 100	10,403.60	+0.83%

Sector performance: Utilities, insurance, telecoms, and oil & gas stocks led the gains. Technology and industrials lagged behind the broader index.

European traders also grappled with the geopolitical backdrop: U.S. Treasury Secretary Scott Bessent told CNBC that the U.S. is allowing Iranian oil tankers passage through the Strait of Hormuz, but President Trump was left “disappointed” after European leaders rejected calls for involvement in a coalition to protect shipping in the waterway.

“Mixed messages are coming from the Trump administration on the war’s duration, as the market focuses more on the actions on the ground that remain escalatory,” said Saul Kavonic, head of energy research at MST Marquee.

Source: CNBC — “European stocks close higher as oil prices spike back above $100”

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Oil & Commodities: Brent Crude Holds Near $102

Oil remained squarely in focus as Brent crude traded near $102 per barrel, sustained by concerns over prolonged supply disruptions through the Strait of Hormuz. Key commodity and currency levels as of the Tuesday close:

Asset	Level	Change
Brent Crude	$101.91/bbl	-1.46%
WTI Crude	$94.58/bbl	+1.2%
Gold	$5,001.00/oz	—
US 10-Year Yield	4.204%	+0.002
EUR/USD	1.1532	-0.06%

Iran’s threat of $200 oil is being taken seriously by analysts. Ron Bousso at Reuters argued the scenario “isn’t that far-fetched,” noting the ongoing disruption to Gulf shipping lanes and the risk of further escalation.

Sources: Reuters Markets, Reuters — “Iran’s $200 oil threat isn’t that far-fetched”

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Crash Fears Ease: Options Market Signals Reduced Tail Risk

Despite the ongoing conflict, options traders’ fears of a U.S. stock market crash have pulled back nearly to levels seen before the February 28 U.S.-Israeli strikes on Iran. Two key gauges highlight this shift:

• Nations TailDex Index (TDEX): Fell to 18.84, just below its pre-war close of 19.01 on February 27.
• Cboe Skew Index (SKEWX): Declined to 141.49, down from 146.67 prior to the air strikes.

“TDEX is signaling that investors are now less worried about a ‘tail event,’ or a really steep drop in equity prices, than at any point since the war started,” said Scott Nations, president of Nations Indexes. However, overall market anxiety remains elevated compared to early February levels — investors have not yet rushed to bet on a sharp rebound past previous highs.

The S&P 500 remains about 4% below its record high close on January 27. Its forward price-to-earnings ratio stands at approximately 21x, down from over 23x in November, but still above the 5-year average of 19x.

Source: Reuters — “US stock market crash fears ease even as Middle East war rages on”

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All Eyes on the Fed

The Federal Reserve kicked off its two-day policy meeting on Tuesday, with the decision due Wednesday. Traders overwhelmingly expect the Fed to hold rates steady, given the inflationary pressures from soaring oil prices. Rate futures now price in just one 25-basis-point cut toward the end of 2026, down from roughly two cuts expected before the Iran conflict began.

“The place where we could get in trouble with this is if the Fed views the oil shock as inflationary and decides to respond with more hawkish monetary policy,” said Ross Mayfield, investment strategist at Baird Private Wealth Management. “The best-case scenario would be some confirmation tomorrow that the Fed is monitoring the situation, but kind of adheres to what they’ve done in the past, which is try to look through big oil shocks.”

The Reserve Bank of Australia separately hiked interest rates for a second consecutive month, warning of material risks from the Middle East conflict.

Source: Reuters

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Looking Ahead

Key events to watch in the coming sessions:

• Wednesday: Federal Reserve interest rate decision and press conference — likely the most important macro catalyst this week.
• Middle East developments: Further escalation or de-escalation around the Strait of Hormuz will continue to drive oil prices and risk sentiment.
• Asian markets: Already rallying Wednesday morning as oil prices paused gains — the Nikkei 225 surged 2.4% to 55,003.
• U.S.-China summit: The planned meeting between Trump and China has been delayed due to the Iran conflict, adding uncertainty to trade relations.

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Disclaimer: This article is for informational purposes only and does not constitute investment advice. All data sourced from Reuters and CNBC. Market data as of market close, March 17, 2026.