\u201cFrom a market structure perspective, this looks very much like a classic ‘TACO’ dynamic with Trump signaling escalation, then stepping back when faced with the economic consequences,\u201d wrote Daniela Hathorn, senior market analyst at Capital.com.<\/p>\n
\u201cThat reinforces the idea that the US administration is actively seeking an exit, even if the path to get there remains unclear,\u201d she added.<\/p>\n
Read more: How to protect your money as Mideast turmoil fuels market volatility<\/a><\/p>\n Nancy Tengler, CEO of Laffer Tengler Investments, said her team sensed the administration was \u201cgetting a little weary\u201d of the conflict and its impacts on the markets heading into last week.<\/p>\n Her firm bought S&P 500 calls on Friday, Mar. 20, positioning for a market rebound ahead of Monday. The trade paid off when President Trump announced on the morning of Mar. 23 that planned strikes on Iran\u2019s power plants would be postponed amid \u201cproductive\u201d talks, a reversal from threats made less than 48 hours earlier.<\/p>\n \u201cThis president \u2014 he pays attention to the stock market. He wants to win the midterms,\u201d Tengler told Yahoo Finance. \u201cI think he’s eager to put this behind him. And also, for the consumer, you know, the tax refunds are going to now be offset by higher gas prices at the pump.”<\/p>\n Wall Street knows the TACO playbook well.<\/p>\n Last April, stocks and bonds plunged after Trump unveiled sweeping tariffs, then rebounded when he paused the plan to instead negotiate with countries individually. The S&P 500 climbed roughly 37% by year\u2019s end, hitting multiple all-time highs and extending gains into 2026.<\/p>\n Read more: The latest news and updates on Trump’s tariffs<\/a><\/p>\n The TACO pattern is so familiar that analysts devised tools like BCA Research\u2019s<\/a> \u201cTrump Pain Point Index” to anticipate when a policy shift might occur.<\/p>\n The gauge tracks short-term stock market moves, long-term treasury yields, mortgage rates, gas prices, inflation expectations, and the president\u2019s approval rating.<\/p>\n This past week, the index hit roughly two standard deviations above the average, its highest level yet. That raises the question of whether a TACO move this time around can calm the markets.<\/p>\n “He can TACO as much as he likes, but a reversal of this indicator ultimately depends on Iran engaging, and so far there has been little sign of willingness,” wrote <\/a>Ole Hansen, head of commodity strategist at Saxo Bank on Thursday.<\/p>\n Tehran has rejected a US ceasefire <\/a>plan which calls for the full reopening of the strategic Strait of Hormuz. The US has deployed Marines and airborne troops <\/a>to the region as the vital waterway remains near a standstill<\/a>, continuing to drive up oil prices.<\/p>\n Iran is “in the driver’s seat for the next steps of de-escalation,” noted BCA Research’s chief strategist Felix-Antoine Vezina-Poirier.<\/p>\n “While the conflict appears to be moving toward some form of resolution, it remains too early to position aggressively for lower oil prices,” he added.<\/p>\n Brent (BZ=F<\/a>) crude futures have surged more than 40% since the war broke out, while the S&P 500 (^GSPC<\/a>) has dropped about 7%. The Nasdaq (^IXIC<\/a>) and Dow (^DJI<\/a>) recently entered correction territory, each down more than 10% from their all-time highs.<\/p>\n \u201cFrankly, I thought the oil prices would go up more, and I thought the stock market would go down more,\u201d said Trump during a Cabinet meeting on Thursday.<\/p>\n With oil above $105 a barrel and the 10-year Treasury (^TNX<\/a>) on the rise, strategists are focusing on protecting portfolios against higher inflation and rising rates.<\/p>\n \u201cI think you have to be very cautious here,\u201d Tim Urbanowicz, Innovator Capital Management’s chief investment strategist, told Yahoo Finance last week.<\/p>\n \u201cThe longer this conflict goes, the longer oil prices stay elevated; more the odds of inflation being sticky because of this [that] go up” he added. “We don’t see an easy off-ramp here.”<\/p>\n Ines Ferre is a senior business reporter for Yahoo Finance. Follow her on X at @ines_ferre<\/a>.<\/p>\n Click here for the latest cryptocurrency news, prices, updates, and more<\/a><\/p>\n Read the latest financial and business news from Yahoo Finance<\/a><\/p>\n ![\"BCA](\"https:\/\/www.europesays.com\/iran\/wp-content\/uploads\/2026\/03\/22f0f570-29f1-11f1-be4f-b4647f6e71da.png\")
BCA Research \u00b7 BCA Research <\/p>\n