Big headline today: Iran rejected the US ceasefire proposal and is continuing strikes across the region. At the same time, the US is deploying more troops, including **1,000 paratroopers and \~5,000 Marines**, which signals this isn’t de-escalating anytime soon.
From a market perspective, this changes the tone. Earlier, there was at least some hope for a pause in the conflict. Now, with no agreement and continued attacks, traders have to start pricing in a **longer disruption cycle**.
The biggest impact is still on oil. The Strait of Hormuz handles roughly **20% of global oil supply**, and any restriction there keeps upward pressure on crude. We’ve already seen oil up **30%+ since late February**, and this kind of news makes further spikes more likely.
But the effect goes beyond energy. Higher oil means higher inflation risk, which can push back rate cut expectations. That hits growth stocks and small caps, while energy and defense names tend to benefit. At the same time, consumer sectors can get squeezed as fuel costs eat into spending.
This is one of those moments where geopolitics starts driving the entire market, not just one sector.
Do you think the market has already priced in a prolonged conflict, or is there still more downside risk if this escalates further?
Not financial advice.