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While everything else bleeds, oil stocks are quietly having a great day. Exxon Mobil (XOM) and Chevron (CVX) each gained more than 1%. Occidental Petroleum (OXY) climbed 3.3%. If oil goes to $100 or beyond, these names print money.
Investors are rotating fast and the energy sector is the only place offering any shelter for now.
With the market in the red, Apple (AAPL) is making headlines for a completely different reason — the Formula 1 season kicks off this weekend and Apple has a major stake in it. The company has been building out its F1 content strategy and this weekend is the first real test of that bet.
Fresh off that record earnings quarter, Marvell (MRVL) just got an analyst upgrade this morning. That’s a double shot of good news for the stock, and it stands out as one of the few bright spots on an otherwise ugly market today. With a consensus target of $114.06 and now a fresh upgrade in the books, MRVL is giving long-term investors something to think about even as the broader market sells off.
Not helping much, nonfarm payrolls fell by 92,000 in February, a sharp drop against the January gain of 126,000 and far below the growth of 50,000 that economists expected. The unemployment rate also rose to 4.4% from 4.3%.
With no end in sight to the war with Iran, oil is nearing $90.
And there are now calls for $100 oil. Worse, according to Qatar’s energy minister, oil could double to more than $150, dragging down global economies. “If this war continues for a few weeks, GDP growth around the world will be impacted. Everybody’s energy price is going to go higher,” he said, as quoted by Daily Mail. “There will be shortages of some products, and there will be a chain reaction of factories that cannot supply.”
So, it comes as no surprise that the S&P 500 is down 1.57%, or by 107 points. The SPDR S&P 500 ETF (SPY) is down 1.55%, or by $10.54. The Dow is down 1.9%, or by 911 points. The NASDAQ is down 1.58%, or by 360 points. The Volatility Index is up 4.70 to 28.40. Gold is up $17.85 at $5,089.73. Bitcoin is down by $2,113 to $68,751.
Unfortunately, there’s no clarity on when this could end.
Not only is Iran not folding, but President Trump just said there’s no deal to end the war without unconditional surrender.
“After that, and the selection of a GREAT & ACCEPTABLE Leader(s), we, and many of our wonderful and very brave allies and partners, will work tirelessly to bring Iran back from the brink of destruction, making it economically bigger, better, and stronger than ever before,” Trump said in a post on Truth Social that made his surrender ultimatum. “IRAN WILL HAVE A GREAT FUTURE. “MAKE IRAN GREAT AGAIN (MIGA!)” he added.
In short, buckle up, folks. Things may get worse before they get better.
Top Tips for Trading in an Excessively Volatile Market
With the market plummeting, here are a few tips you may want to follow.
Tip No. 1 – Don’t Panic – Stay Calm.
Easier said than done, I know.
But remember, markets are resilient. We’ve come back from far worse. If you panic, you sell. And if you sell, you miss the potential for the recovery rally. We have to remember that markets are resilient and eventually recover, as they have historically. In fact, look back at the history of bad moves, and you’ll see that each time a recovery rally followed them.
Tip No. 2 – Take Some Advice from Warren Buffett
Legendary investor Warren Buffett has always advised investors to take a long-term outlook because short-term volatility is typical. Better, just as we noted above, even the most painful recessions are temporary. In fact, in a 2016 annual shareholder meeting, the billionaire suggested that dark clouds would fill the economic skies and they would briefly rain gold.
“During such scary periods, you should never forget two things: First, widespread fear is your friend as an investor, because it serves up bargain purchases. Second, personal fear is your enemy. It will also be unwarranted,” as quoted by MarketWatch.
Tip No. 3 — Don’t Wait Too Long to Invest
It may not seem like a great time to invest. But if you wait too long, you’ll actually miss out.
As Warren Buffett has also said, “I haven’t the faintest idea as to whether stocks will be higher or lower a month or a year from now. What is likely, however, is that the market will move higher, perhaps substantially so, well before either sentiment or the economy turns up. So if you wait for the robins, spring will be over.”
Plus, as he has famously said, “Be fearful when others are greedy, and be greedy when others are fearful.” Sure, there’s plenty of fear out there. But fear won’t last forever. Even the biggest companies in the world will have hiccups, but in 10-20 years, they should be just fine.