Hormuz Shuts Down, US Payrolls Crash, AI Raises $140B

The week that forced every portfolio manager on Earth to recalculate. The Strait of Hormuz, responsible for 20% of global oil transit, went from contested to effectively shut down, sending WTI crude up 18% in five sessions. A horrific jobs report confirmed the labor market is cracking, not bending. And while the real economy absorbed body blows, the AI sector kept printing record checks: $140 billion raised across two companies in two weeks.

Markets scoreboard

Asset	Mon Open	Fri Close	Weekly Change
S&P 500	6,881.62	6,740.02	▼ 2.1%
NASDAQ-100	24,992.60	24,643.02	▼ 1.4%
BTC	$66,738	$67,882	▲ 1.7%
ETH	$1,956	$1,984	▲ 1.4%
SOL	$84.01	$84.51	▲ 0.6%
Gold (XAU)	$5,255	$5,153	▼ 1.9%
Oil (WTI)	$76.79	$90.90	▲ 18.4%
VIX	~19.5	~23.75	▲ 22%
US 10Y	4.05%	4.15%	+10bp
US 2Y	3.47%	3.56%	+9bp

Oil was the only trade that worked in a straight line this week. Everything else whipsawed. Equities sold off on the jobs miss, crypto popped mid-week on institutional catalysts before fading, and gold pulled back slightly from record highs despite safe-haven demand running hot. The yield curve steepened as the long end priced in oil-driven inflation.

Top stories

The Strait of Hormuz is effectively closed

The 2026 Strait of Hormuz crisis escalated from tense to fully disrupted this week. After the US-Israeli strikes that killed Supreme Leader Khamenei on February 28, Iran’s IRGC moved to block the strait, a 21-mile-wide chokepoint handling roughly 20 million barrels of oil per day.

Tanker traffic dropped 70% within hours of the initial strikes and has since fallen to near zero. At least 17 vessels were attacked or damaged between March 1 and March 7, including strikes on US-flagged tankers at the port of Bahrain. Qatar shut down gas production at Ras Laffan and declared force majeure on LNG contracts. Iraq began shutting the Rumaila oil field because stranded tankers left nowhere to put the oil. Japan’s refiners, who source 95% of their crude from Gulf producers, requested emergency stockpile releases.

WTI crude surged from $76.79 to $90.90. Brent touched $92. Barclays and Goldman Sachs both warned that $100/bbl is realistic if the blockade persists through March.

The human cost continued to mount. Iranian civilian deaths exceeded 1,200 according to multiple reports. The conflict expanded to Lebanon, with Hezbollah launching rockets into Israel and drawing Israeli counterstrikes on Beirut. On March 7, Iran’s President Pezeshkian said Iran would stop striking neighboring countries unless attacks originated from their territory. Dubai International Airport was hit by Iranian drones later that same day.

US economy sheds 92,000 jobs

Friday’s February employment report was ugly. Nonfarm payrolls fell by 92,000, against consensus expectations for a gain of 59,000. The unemployment rate ticked up to 4.4%, and December’s already-weak numbers were revised down sharply, from +48,000 to -17,000.

The weakness was broad-based: healthcare lost 28,000 jobs (a 31,000-worker strike in California and Hawaii drove most of that), information shed 11,000, the federal government lost another 10,000 (bringing total federal job losses to 330,000 since October 2024’s peak), and manufacturing dropped 12,000. The three-month average payroll gain now sits below 6,000 per month.

Plante Moran pointed out that if labor force participation had held steady instead of dropping to 62.0%, unemployment would have topped 5%. Average hourly earnings still rose 0.4% month-over-month (3.8% YoY), so wage pressure persists even as hiring collapses. That’s the stagflation setup in one sentence.

AI labs raise $140 billion in two weeks

The numbers are hard to process. OpenAI closed $110 billion at a $730 billion pre-money valuation ($840B post). Amazon put in $50 billion, Nvidia and SoftBank each contributed $30 billion. AWS becomes OpenAI’s exclusive enterprise distributor under a separate $100 billion infrastructure commitment. Microsoft sat this round out.

Two weeks earlier, Anthropic raised $30 billion at a $380 billion post-money valuation, a round that tripled from its initial $10B target. Claude Code’s run-rate revenue exceeds $2.5 billion and has doubled since January. Enterprise clients spending over $100,000 annually increased sevenfold in twelve months.

For context: 90% of all venture capital deployed in February went to AI companies. Seed-stage funding dropped 11% year-over-year while mega-rounds surged 780%. Waymo secured $16 billion separately. The capital concentration is staggering, and the question of when these investments generate returns proportional to their size is getting louder at investor conferences.

AI and tech

Anthropic finds itself in an unusual position: its Claude model is reportedly being used in US military operations, with Defense Secretary Hegseth directing “AI-first warfighting” across all branches. At the same time, the Pentagon flagged Anthropic as a supply-chain risk for federal contracts. The mixed signals haven’t hurt consumer adoption. Downloads jumped 51-88% following OpenAI’s corporate drama, and Claude briefly surpassed ChatGPT in US daily downloads.

OpenAI is building an internal GitHub alternative. If that ships, AI labs would be competing directly with developer-tool SaaS companies. Broadcom forecast AI chip sales exceeding $100 billion by 2027, with Meta and OpenAI as anchor clients.

Oracle is cutting thousands of jobs to fund its data center buildout. Outside the top tier of AI companies, the tension between infrastructure investment and near-term profitability is real and getting worse.

Paper, an AI-native design tool positioned against Figma, hit #1 trending on RAMP’s SaaS rankings. Incumbent creative tools are starting to feel pressure from AI-native alternatives.

Crypto and DeFi

Kraken Financial became the first digital asset bank to receive a Federal Reserve master account, granting direct Fedwire access for settlement without intermediary banks. The Wyoming-chartered bank operates on a full-reserve model. Phased rollout starts with institutional clients. Separately, Morgan Stanley filed a BTC ETF and selected Coinbase and BNY Mellon as custodians.

On the protocol side, Solana’s Alpenglow upgrade is progressing toward a mid-2026 launch. The overhaul replaces Proof of History with Votor consensus, targeting 100-150 millisecond block finality, roughly 100x faster than the current 12.8 seconds. It also introduces Rotor for block propagation, with simulations showing 18ms propagation under typical conditions. For DeFi and HFT applications, the latency reduction changes what’s possible on-chain.

The CLARITY Act, intended to classify digital assets as commodities vs. securities, stalled in Congress over stablecoin reward disputes with banks. Trump criticized the delays. If US regulatory gridlock persists, capital will keep flowing to jurisdictions with clearer frameworks, like the EU under MiCA.

Bitcoin traded in a wide range. It hit $73,409 mid-week on institutional inflow momentum (roughly $500 million entered Bitcoin ETFs) before retreating to $67,882 by Friday as risk-off sentiment took over. The Fear & Greed Index dropped to “Extreme Fear,” which has historically been a contrarian buy signal, though not one to bet on during active war.

Geopolitics and macro

The Fed meets March 17-18 with rates at 3.50-3.75% and nowhere to go. Core PPI surged to 3.6%, the highest in over three years. Oil above $90 adds direct inflationary pressure. But payrolls just turned negative for the first time in months, and the three-month hiring trend is nearly flat. Rate cuts, previously expected in June, are now in serious doubt. JPMorgan’s call: zero cuts in 2026.

Kevin Warsh has been nominated as the next Fed Chair, replacing Powell. The transition could shift monetary policy orientation, though the immediate problem is the same regardless of who’s in the chair: you can’t cut rates into an oil shock with sticky inflation.

The war costs an estimated $900 million per day for US operations. Defense spending is crowding out other budget priorities while the “One Big Beautiful Bill Act” proposes $100 billion in tax cuts. Rising military expenditure, falling tax revenue, stubborn inflation. Bond markets have noticed: the 30-year yield hit 4.77%.

Tariff headwinds persist: 25% on Mexico and Canada, 10-60% on China, 50% on steel and aluminum. The IMF estimates a 0.5-1.0% GDP drag from tariffs alone, and import prices rose 1.2% month-over-month. A new tariff round on Canada and Mexico was pushed to early April.

Quick hits

Marvell (MRVL) surged 18% after reporting data center revenue up 21% YoY, with FY27 guidance around $11 billion
Samsara (IOT) jumped 20% on a Q4 beat and 21-22% FY27 revenue growth guidance
Western Union partnered with Crossmint to launch USDPT, a stablecoin on Solana integrated with WU’s global payout network
Trump fired DHS Secretary Kristi Noem, nominating Senator Markwayne Mullin as replacement
Sweden joined NATO as its 32nd member
Iranian crypto outflows spiked 700% post-strikes, with IRGC accounting for over 50% of exchange inflows (Chainalysis)
The Supreme Court heard arguments on the potential dismissal of Fed Governor Lisa Cook, raising questions about central bank independence
A deadly tornado outbreak struck the US Heartland, killing at least 8

What to watch next week

FOMC meeting (March 17-18): The dot plot is the main event. Any change in the median rate path moves markets. Watch for language on oil and tariff pass-through in the statement.
February CPI: Due before the Fed meeting. If core CPI accelerates from January’s already-sticky reading, “higher for longer” hardens from narrative to consensus.
Strait of Hormuz shipping data: Daily tanker tracking is now a macro indicator. Any resumption of traffic signals de-escalation; continued blockade keeps $100 oil on the table.
Iran diplomatic channels: Watch Turkey and Qatar mediation. Pezeshkian’s pledge to stop striking neighbors, broken within hours, suggests internal debate about escalation costs.
Bank earnings: JPMorgan, Wells Fargo, Citigroup, Goldman Sachs, and Morgan Stanley all report. Credit quality and NIM commentary will show how the rate environment and geopolitical shock are flowing through to lending.
Consumer earnings: Walmart, Target, Lowe’s later in the week. Guidance matters more than beats. Any mention of consumer pullback or margin compression from input costs is a recession signal.

Sources

This report was generated by an AI agent using OpenClaw, reviewed and published by a human. The same system produces a daily intelligence briefing every morning. All data is sourced from public APIs and news outlets listed above.