Global markets begin the week with attention still firmly fixed on the conflict centered on Iran and the resulting pressure on oil and gas prices. The narrow Strait of Hormuz - a waterway that handles about a fifth of global oil shipments - has been effectively obstructed, tightening tanker flows and pushing energy prices higher. That dynamic continues to weigh on economic prospects and market sentiment even as several major corporate and policy events offer additional potential catalysts for investors.
This briefing walks through the five items likely to shape trading sentiment in the coming days: the ongoing Iran war and its effects on energy markets, Nvidia's annual developer conference and CEO Jensen Huang's address, earnings from memory-chip maker Micron, the Federal Reserve's policy meeting, and the European Central Bank's decision later in the week.
1. Iran conflict remains central
The conflict involving Iran entered its third week as U.S. stock futures rallied on Monday. U.S. President Donald Trump called for international assistance to reopen the shuttered Strait of Hormuz. By blocking most tanker traffic through the strait, Tehran has curtailed supplies of oil and gas that are vital to many large economies, particularly in Asia.
Energy prices jumped as a consequence of the disruption, creating renewed upside pressure on inflation and posing a drag on broader economic activity. Analysts at Vital Knowledge summed up the market view of the situation in a note, saying: "the U.S. and Israel are winning in the conventional military sense, but the Iranian regime is firmly entrenched in power, and Tehran is succeeding in holding the global economy hostage by closing Hormuz."
The surge in oil has presented a political headache at home for President Trump; the joint campaign with Israel has broadened in scope across the Middle East and, in the U.S., pump prices have risen. That increase in retail gasoline prices has prompted commentary that higher energy costs could affect political dynamics heading into the midterm elections in November.
2. Nvidia's Huang to headline developer conference
Investors will closely monitor Jensen Huang's remarks at Nvidia's annual developer conference, which begins on Monday. Nvidia is positioned as a leader in semiconductors for artificial intelligence, and shareholders are watching to see what product and strategy moves the company will unveil as competition intensifies.
Nvidia faces competition not only from established chipmakers such as Advanced Micro Devices and Intel, but also from large technology firms including Alphabet's Google that are developing processors optimized for AI workloads. The rise of AI "inference" - the stage where AI models execute tasks on behalf of users - poses a particular challenge because inference workloads often run on chip types different from Nvidia's main processors. Some of Nvidia's customers, including OpenAI and Meta Platforms, have indicated they may produce their own inference-optimized chips.
In December, Nvidia paid $17 billion to acquire Groq, a company that specializes in rapid and low-cost inference processing. Nvidia's chief executive indicated last month that he planned to demonstrate how Groq's capabilities can be integrated with Nvidia's CUDA software platform.
The company has also invested roughly $2 billion in Lumentum and Coherent, manufacturers of lasers capable of using light beams to transmit data quickly between chips. While the laser technology could accelerate connectivity between chips, those parts are not yet produced at the same volumes as Nvidia's widely used processors. Analysts at BofA Securities wrote in a note that they "expect Nvidia to announce a further broadened AI portfolio." Investors will be watching for specific product details and how Nvidia positions these moves amid rising industry competition.
3. Micron reports quarterly results
Memory-chip maker Micron will post its latest earnings after the U.S. market close on Wednesday, supplying another data point in the evolving AI hardware narrative. In December, Micron provided an upbeat forecast for adjusted profit in its fiscal second quarter, driven by elevated prices across memory markets resulting from ongoing supply constraints.
The ramp-up in AI development among large technology companies has increased demand for high-end memory chips housed in data centers, an area where Micron supplies critical components. For its fiscal second quarter the company guided adjusted earnings of $8.42 per share, plus or minus $0.20 - a number that was nearly double analyst estimates cited by Reuters.
Micron's CEO Sanjay Mehrotra has told investors that the memory market's tightness is expected to persist beyond 2026, and that Micron would likely be able to meet only between half and two-thirds of demand from several key customers. That ongoing supply-demand imbalance is an important factor for Micron's near-term revenue and margin outlook and for the broader market for memory chips.
4. Federal Reserve meeting in focus
Central bank policy decisions are another set of headline risks this week, with the Federal Reserve's two-day meeting culminating on Wednesday. The Fed is widely expected to leave interest rates unchanged at the end of the gathering, and Chair Jerome Powell - who is due to step down from the Fed in May - will hold one of his last post-decision press conferences.
Investors will be attentive to Powell's commentary on the U.S. labor market and inflation. Recent U.S. jobs data came in much weaker than expected, underscoring potential fragility in employment. Simultaneously, the Iran-related jump in oil and gas prices could push inflation higher. These two trends present a policy dilemma: cutting rates may support hiring but could risk increasing inflation, while raising borrowing costs could curb price growth at the potential cost of weakening the labor market.
Markets will be scanning for any signals about how the Fed plans to weigh these conflicting forces in the coming months.
5. ECB decision and Europe's inflation risk
In Europe, stopped traffic through the Strait of Hormuz threatens to reaccelerate inflation at a time when the region had been widely seen as having made progress in containing price growth. Europe relies heavily on energy imports that traverse the strait, and higher oil and gas prices can exert upward pressure on consumer prices and on borrowing costs in the region.
The spike in energy prices has already affected European markets. The Stoxx 600 index has fallen by more than 5% from its pre-conflict peak. That move partly reflects investor concern that the European Central Bank might be forced to contemplate additional rate increases in response to renewed inflationary pressure.
The ECB will announce its monetary policy decision later in the week alongside other major central banks, including the Federal Reserve. Despite the Middle East fighting, a Reuters poll of economists indicated expectations that the ECB will hold rates steady through the remainder of 2026. Laurence Booth, Global Head of Markets at CMC Markets, advised watching how the Fed and other central banks assess inflation in light of the oil-price surge, saying: "Central banks are not expected to make major changes to monetary policy this month, but watch closely for how the Fed and others assess the inflation outlook after the surge in oil prices."
What market participants will watch
Energy prices and supply dynamics tied to the Strait of Hormuz, and the potential for sustained inflationary pressure.
Technology sector developments, notably Nvidia's product announcements and Micron's earnings report, which will shed light on demand and pricing in AI-related hardware markets.
Central bank guidance from the Fed and ECB on the balance between inflation control and labor-market support, including any subtle shifts in forward guidance during press conferences.
Context for investors
The confluence of geopolitical disruption, technological competition and central bank policy means a wide range of market sectors face elevated uncertainty. Energy producers and suppliers are directly exposed to the Iran-driven move in oil and gas prices. Technology firms, particularly those linked to AI hardware and data-center infrastructure, will be sensitive to product announcements and to memory-chip supply dynamics. Financial markets overall will also be responsive to tone and guidance from central banks as they balance competing pressures on inflation and employment.
Investors should monitor corporate disclosures and central bank commentary closely over the coming week to assess whether recent trends intensify or abate, and how that might influence asset prices and economic momentum.