March 2026 Investment Update
When Headlines Move Markets, Process Guides Portfolios
If the past few weeks have felt headline-heavy, that’s because they have been.
From geopolitical escalation in the Middle East to renewed uncertainty around U.S. trade policy, markets have been digesting a steady stream of developments that can shift sentiment quickly. When events like these unfold, volatility often follows. What matters most is not predicting how long the headlines will dominate, but ensuring portfolios are positioned appropriately when they do.
That is where process matters.
Where We Stand
We finished the month still overweight Consumer Staples, Healthcare, Biotech, and Value. No changes were made.
These positions have been in place for several months and have helped our clients navigate the recent choppiness better than the broader market. Importantly, this positioning was not the result of predicting a specific geopolitical event or policy shift. Our systematic indicators guided us there based on market conditions that were already signaling a need for more defensive exposure.
Consumer Staples tend to maintain demand regardless of economic cycles. Healthcare and Biotech are driven more by innovation and demographics than by short-term trade or geopolitical shifts. Value-oriented stocks often provide relative stability when inflation concerns resurface or when leadership rotates away from higher-multiple growth names.
Preparation, not prediction, is what makes that positioning valuable now.
Market Recap
February: Rotation Beneath the Surface
February was a month of crosscurrents. Inflation data, sector rotation, AI-related repositioning, and policy uncertainty all influenced market movement.
While headline indices showed relatively modest overall changes, leadership continued to rotate beneath the surface.
Aggregated market performance from end-of-month index data showing monthly declines for major U.S. benchmarks due to AI, tariff, and geopolitical uncertainty. https://www.barchart.com/story/news/478706/how-major-us-stock-indexes-fared-friday-2-27-2026
Several themes defined the month:
- Rotation away from parts of the technology sector
- Continued resilience in more defensive areas
- Ongoing debate around inflation and the timing of potential rate cuts
- Increased sensitivity to geopolitical and policy headlines
Markets were not collapsing. They were recalibrating.
Geopolitical Shock: Energy and Inflation Implications
The coordinated U.S.–Israel strike on Iran in early March triggered immediate market reactions. Oil prices surged, gold rallied to historic highs, Treasury yields fell, and sector performance diverged sharply. Energy and defense stocks moved higher, while airlines and transportation stocks declined.
The most important economic variable here is energy.
Higher oil prices feed directly into transportation and manufacturing costs. That complicates the Federal Reserve’s path, particularly if inflation pressures begin to reaccelerate just as markets were hoping for rate relief.
But again, we do not reposition portfolios based on a single weekend development. We evaluate whether new data meaningfully alters risk and trend signals. So far, our indicators continue to support current positioning.
The Supreme Court Tariff Ruling: Another Layer of Uncertainty
Adding to the policy backdrop, a recent Supreme Court ruling on tariffs has reintroduced trade policy into the market conversation.
February’s PMI and economic data were largely collected before these developments, meaning we may not see the full economic impact reflected until March reports are released. Markets dislike uncertainty, and trade policy decisions can influence supply chains, pricing pressures, and corporate margins.
At this stage, however, the ruling adds complexity rather than clarity. As with geopolitical events, we will evaluate its impact through observable data rather than speculation.
Policy shifts create noise. Process filters it.
What This Means for Your Portfolio
Defensive positioning does not mean risk-free. Markets can still decline. Volatility can persist. What it does mean is that exposure is tilted toward areas historically more resilient during periods of uncertainty.
We remain:
- Overweight Consumer Staples
- Overweight Healthcare and Biotech
- Leaning into Value
- Avoiding higher-volatility areas where risk appears less compensated
Our indicators will tell us when it is time to adjust. Until they do, discipline means maintaining course.
Uncertainty is constant in investing. Headlines change daily. Process is what endures.
As always, if you would like to discuss how current developments relate to your personal plan, we are here.
The opinions expressed are those of Strategic Advisory Partners, who reserves the right to modify its current investment strategies and techniques based on changing market dynamics or client needs. There is no guarantee that their assessment of investments will be accurate. This material is for informational purposes only and should not be construed as investment advice. Past performance is not indicative of future results. All investing involves risk, including the loss of principal, and there can be no guarantee that investment objectives will be met.
