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Posted March 4, 2026 at 11:26 am
Markets reacted swiftly to rising geopolitical tensions as energy stocks surged and volatility returned to Wall Street. Longtime collaborator and friend of the show, Scott Bauer, joins our IBKR Podcast to discuss the global market reaction, the outlook for the VIX and the key economic data investors are watching next.
The following is a summary of a live audio recording and may contain errors in spelling or grammar. Although IBKR has edited for clarity no material changes have been made.
Hi everyone. This is Jeff Praissman with the Interactive Brokers Podcast. It’s my pleasure to welcome back to the podcast studio Scott Bauer from Prosper Trading Academy. Hey Scott, how are you?
Jeff, I am good. How are you?
I’m good. Always love to see you on these Wednesday mornings when we talk about the market. Let’s not waste any time. Let’s start with what’s on everyone’s mind. What companies or sectors have been most negatively and positively affected by the current Iran conflict?
Sure. I mean obviously energy, right away. Energy was hot. We saw oil stocks rally. We saw producers rally—anything related to energy, especially natural gas. Right now that’s cooled a little bit, and that kind of ebbs and flows a bit with what the news rhetoric is coming out on—how deep the conflict is, or maybe there’s talk of negotiations. But that certainly has been front and center.
Some of the tech stocks that we had seen actually had been battered over the last several weeks and even months. I don’t want to say we’re seeing a bottoming out, but there’s definitely been some buying in some of those. The banks have been under pressure, though we saw a little bit of a nice rally over the last couple days. But overall, the banks have been under some pressure.
And how are the European and Asian markets reacting in this conflict? Or are they not reacting at all?
Sure. The Asian markets absolutely got pummeled. We saw some pretty record-breaking losses there, especially in South Korea. A lot of that is based on inflation shock because of oil prices. Pretty similar in Europe, though not quite as bad as what we saw in Asia. I think everybody is really on the defensive right now. But to me, Asia really got hit harder because of the massive run-up that we had seen prior to this conflict.
Yeah, and I think to pivot away from the conflict right now, let’s talk about some economic indicators. What were some of the market movers last week?
Well, we had some inflation data, and this week we have the jobs number on Friday. But last week we saw inflation data and some manufacturing data that I think was actually fairly positive for the markets. Now positive—what does that mean? Does that mean better for the markets going higher or better for the economy? That’s up to people’s interpretation. But I think what we have seen is that the economy is on fairly steady footing here this week. I think the big number is going to be this jobs number. How does that fit into the grand scenario of the weakness that we have seen in the labor market recently? Is that going to continue?
Yeah, and besides the jobless claims, we also have the Fed Beige Book coming out. We have existing home sales and some other maybe smaller reports. You already mentioned that you think the jobless claims are going to be the big one. Anything else that might surprise the market and cause movement either positively or negatively?
I think the Beige Book can definitely play into the Fed’s thinking and the Fed’s decision-making. There’s been a little bit more consternation about whether there is going to be a move in March or not. Most likely it’s still no, but that has been on the table. But given some of the strong data that we have seen outside of the jobs numbers, that probably does not bode well for the Fed cutting.
Gotcha. And I gotta end it on our favorite topic—the VIX—which is trading above 20. Does this continue to climb, stay steady, or do you think it kind of comes off a little bit?
Sure. We finally saw a real pop in the VIX up to the high twenties—up to 28 or so—where recently a pop was more like 22 or 23. But we saw it come back down pretty quickly. I think it’s really difficult to remain at those levels. I really do.
The market has been incredibly resilient, and I don’t think we’re going to see that high-twenties number, and especially not a three handle on the VIX. But what is the norm over time? Seeing a VIX kind of in the mid-teens. I don’t know that we’re going to get back there anytime soon.
Got it. So this might be the new normal, at least for the not-too-distant future. Got it. Scott, this has been great as always. For our listeners, you can find more from Scott at Prosper Trading Academy, also on our website. Go to IBKR.com, click on Education. You can find past podcasts and past webinars. Always a pleasure to have you in the studio, Scott.
Appreciate it, Jeff. Thanks.
Alright, have a good one.
You too.
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