Oil Price Spike Sends Shockwaves Through Markets

0:00Welcome to Risk Reversals Market Matrix, your AI-generated podcast curated by Guy Adami and Dan Nathan, breaking down the day's most impactful stock market and business headlines. I'm your host Brunson, and all of today's market data is provided by FACSET, it's Friday, March 6th, and these are your top stories. The stock market sell-off continued today as surging oil prices and weak economic data rattled investors. The Dow Jones industrial average dropped about 450 points, or 1%. While the S&P 500 and NASDAQs each fell more than 1%, with economically sensitive stocks like Caterpillar and travel companies under pressure. Oil prices drove much of the market anxiety. WTI crude surged above $90 a barrel, jumping 12% and more than 35% on the week. The largest weekly gain since futures trading began in 1983, according to CNBC. Global benchmark Brent Crude climbed to nearly $93, up roughly 28% for the week.

1:05The rally comes as the escalating US-Iran conflict has severely disrupted traffic through the strait of Hormuz, a critical route for global oil shipments, raising fears of major supply disruptions. At the same time, fresh economic data showed signs of cooling in both the US labor market and consumer spending. Employers unexpectedly cut 92,000 jobs in February and unemployment rose to 4.4%, one of the largest payroll declines since the pandemic, with weakness across manufacturing, construction and transportation. Retail sales also fell 0.2% in January. As harsh winter weather and weaker auto purchases weighed on consumer activity. In interviews with CNBC, San Francisco Fed President Mary Daily said a softening labor market alongside inflation still above the Fed's 2% target complicates interest rate decisions and argues for patients. While Fed Governor Stephen Moran said the week jobs report strengthens the case for additional

2:07rate cuts. The combination of slowing growth and rising energy prices has begun to revive talk of stagflation on Wall Street, weighing on investor sentiment. That's your market wrap. Now let's get to a few other stories catching our eye. Wall Street trading desks are urging investors to rotate into high-quality companies, with strong balance sheets and durable cash flows, as markets grapple with geopolitical turmoil and rising oil prices. Strategies vary across banks. Bank of America favors halo stocks, hard assets with low-obsolescence. While Goldman Sachs recommends a geopolitical basket of defense, energy, and tanker companies. Barclays, meanwhile, seize a return of the magnificent seven mega-cap tech stocks, arguing their strong balance sheets and AI spending make them a potential safe port in a storm. The broader message from strategists is to lean into financially strong companies and avoid credit-sensitive sectors as volatility rises. Despite renewed focus on tariffs following a recent Supreme Court decision and new trade

3:10measures from the Trump administration, mentions of tariffs on S&P 500 earnings calls actually declined in the fourth quarter. According to our official data provider FACTSET, the term appeared on 220 earnings calls, down 18% from 267, in Q3, marking the third straight quarterly decline. And so, tariff discussions remain elevated historically, ranking as the fifth-highest level of mentions in the past decade, with industrials, materials, and consumer staples companies referencing them most frequently. Bloomberg reports that Oracle and OpenAI have scrapped plans to expand a major AI data center in Abelene, Texas after negotiations stalled over financing and OpenAI's evolving infrastructure needs. The collapse has opened the door for Meta to potentially lease the expansion site, with Nvidia helping facilitate discussions to ensure its chips remain central to the project. The site is part of the high-profile Stargate AI Infrastructure Initiative, which was announced

4:13at the White House last year. The shifting plans highlight the complexity and massive costs of building next-generation AI data centers, which can require tens of billions of dollars and coordination across multiple partners. CNBC reports Amazon will continue offering Anthropics AI models to its cloud customers. Excluding work tied to the U.S. Department of Defense, after the startup was labeled a potential supply chain risk by the agency, Amazon Web Services said customers can still use Anthropics Cloud models for all non-defense workloads. While those tied to defense projects will need to transition to alternatives on AWS. The move mirrors similar updates from Microsoft and Google, which also said Anthropic models will remain available outside defense-related uses. Amazon remains one of Anthropics' biggest backers, having invested $8 billion in the AI startup since 2023, while AWS serves as its primary cloud and training partner. The Financial Times reports that BlackRock has limited withdrawals from one of its flagship

5:15private credit funds after a surge in redemption requests highlighted growing investor concerns about the asset class. The firm approved only 54% of withdrawal requests from its $26 billion HPS corporate lending fund in the first quarter, hitting a 5% redemption cap that allows it to restrict further outflows. The move comes as investors pull money from semi-liquid private credit funds, amid questions about credit quality, recent write downs, and pressure from lower interest rates, shares of alternative asset managers, including BlackRock, KKR, Blue Owl, and Aries, fell sharply as the withdrawals raised broader concerns about liquidity across the private credit industry. Robinhood has launched its first fund giving everyday investors access to private companies. With the Robinhood Ventures fund, one beginning trading on the New York Stock Exchange at $25 per share before falling to about $22 in early trading. According to the Wall Street Journal, the publicly traded venture capital fund holds stakes in private firms, including Databricks, Revolute, and ORA, allowing investors to

6:20gain exposure to companies that have traditionally been limited to wealthy or accredited investors. Robinhood says the goal is to democratize access to private markets, as many of the fastest growing companies remain private for longer. Executives also signaled the fund could be the first of several similar offerings. That's your risk-reversal market matrix. Be sure to follow us to get alerts on new episodes every day. All of the articles mentioned on today's podcast can be found in the show description. To get Guy Adami and Dan Nathan's market analysis, on these topics and more, listen to market call on Risk Reversals YouTube page Monday through Thursday. Story Curation by Risk Reversal, Scripts by PerplexityPro, Voice by 11 Labs. I'm Brunson. Thanks for listening.