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Geopolitical Shockwaves: Energy Surges as Markets Retreat · The SPY Trader

• 0:00
  Good morning , traders !
• 0:02
  It is 5 am on Tuesday , March 3rd , 2026 , here on the Pacific Coast , and you are listening to Spy Trader .
• 0:10
  I am your host , Barnaby Butterscotch , and we have a lot to unpack this morning as the market wakes up to some serious global headlines .
• 0:18
  The big story today is the dramatic escalation of geopolitical tensions in the Middle East .
• 0:23
  We are seeing reports of direct military conflict involving the US , Israel , and Iran .
• 0:30
  Perhaps most significantly for the markets , the Strait of Hormuz has been closed .
• 0:35
  This is a major chokepoint for about twenty percent of the world's oil , and the markets are reacting in a defensive , riskoff posture .
• 0:42
  As of midday , the S&P 500 , or SPY , is trading around 6,784 , which is down about 1.41 percent .
• 0:53
  We are seeing it test that 50day moving average , losing that nice momentum runway we saw at the start of the year .
• 1:00
  The Dow is down over 800 points , and the Nasdaq , or QQQ , opened down 2.2 percent as tech leaders face a valuation reality check .
• 1:10
  Meanwhile , safe havens are shining .
• 1:13
  Gold , tracked by GLD , has surged over 5,400 dollars an ounce .
• 1:18
  The goldilocks narrative we enjoyed recently has been disrupted by a massive supplyside shock .
• 1:24
  Brent crude oil has jumped 9 percent this week , surging past 82 dollars a barrel .
• 1:31
  This , combined with a hot January CPI of 2.4 percent and a Producer Price Index of 0.8 percent , means inflation is looking pretty sticky .
• 1:42
  Because of these rising energy costs , the market now sees less than a 5 percent chance that the Federal Reserve will cut rates at their March 17th meeting .
• 1:52
  We are also seeing the 10year Treasury yield climb to 4.04 percent , which is putting a lot of pressure on highgrowth tech and real estate .
• 2:02
  Looking at the sectors , it is a tale of two markets .
• 2:05
  The winners are Energy and Defense .
• 2:07
  The Energy Select Sector SPDR , or XLE , is the star performer today .
• 2:13
  Exxon Mobil is up over 5 percent , and Marathon Petroleum has jumped nearly 6 percent .
• 2:19
  In the defense space , Northrop Grumman and RTX Corp are up significantly , while Palantir has risen 5.8 percent as it is increasingly seen as an essential digital defense tool .
• 2:32
  On the flip side , the losers are transportation and consumer discretionary .
• 2:37
  Airlines like United and Delta are plummeting because of those skyhigh fuel costs .
• 2:42
  In tech , even NVIDIA is struggling today as investors worry about geopolitical risks .
• 2:49
  We are also in the thick of earnings .
• 2:51
  Best Buy reported a beat on earnings per share but a slight miss on revenue , and their cautious outlook has the stock under pressure .
• 3:00
  Later today , we are watching Target , and after the bell , we will get results from CrowdStrike and Ross Stores .
• 3:07
  Investors are particularly nervous about CrowdStrike due to new AI competition .
• 3:12
  Now , for some trading thoughts .
• 3:14
  If you are a conservative investor looking for income , consider the Vanguard Real Estate ETF , or VNQ .
• 3:22
  It has a yield near 4 percent and could see a boost if the Fed eventually cuts rates .
• 3:28
  For stability , the iShares Core U.S.
• 3:30
  Aggregate Bond ETF , or AGG , is a good place to park cash during this flight to safety .
• 3:37
  For my aggressive growth traders , take a look at Palantir .
• 3:41
  It bridges the gap between tech growth and defense stability , making it a unique hedge right now .
• 3:47
  Also , keep an eye on CrowdStrike ; if it drops on valuation jitters tonight despite good numbers , it might be a buy the dip opportunity .
• 3:57
  Finally , for a tactical play , stick with the Energy Select Sector SPDR or Exxon Mobil .
• 4:03
  With oil at 82 dollars , their cash flow is immense .
• 4:07
  My advice for the next few weeks is to avoid fuelsensitive sectors like the JETS airline ETF and keep a healthy allocation in energy and gold while this conflict remains unresolved .
• 4:19
  Stay sharp out there , and I will see you in a few hours for the next update !