Week Ending April 3, 2026
DJIA
46,505
+3.0% (wk)
S&P 500
6,583
+3.4% (wk)
NASDAQ
21,879
+4.4% (wk)
Markets post first weekly gains since Iran conflict began; March jobs blow past expectations as oil holds above $110; Blue Owl caps redemptions
U.S. equity markets staged a dramatic relief rally, posting their first weekly gains since the Iran conflict erupted five weeks ago. The S&P 500 surged 3.4% for the week to close at 6,582.69 on Thursday (markets closed Friday for Good Friday). The Nasdaq led gains with a 4.4% weekly advance to 21,879.18, while the Dow rose 3.0% to 46,504.67. The Russell 2000 climbed 3.4% for the week to 2,530.04. Thursday’s session showcased extreme volatility as indexes plunged sharply intraday—the Dow fell 668 points, S&P dropped 1.5%, Nasdaq sank 2.2%—before reversing higher after Iranian state media reported the country is working with Oman on a protocol to “monitor” ships passing through the Strait of Hormuz. The recovery suggests exhausted short positions and desperate bid for any diplomatic progress, however tenuous. President Trump’s Wednesday night address warning the conflict could last “two to three weeks” and threatening to bring Iran “back to the stone ages” had initially triggered the selloff. Oil surged to $113/bbl intraday Thursday before settling around $111-112 as traders parsed the Oman monitoring protocol—a far cry from full reopening but potentially allowing selective passage.
Friday’s March jobs report—released while markets were closed for Good Friday—delivered a massive upside surprise: 178,000 jobs added versus 60,000 expected, with unemployment falling to 4.3% from 4.4%. The blowout print, nearly triple consensus, came after February’s shocking 92,000 job loss and sparked an immediate bond market reaction. The 10-year Treasury yield jumped 3 basis points to 4.35% in abbreviated Friday trading, reinforcing the narrative that the Fed will remain on hold indefinitely despite oil-driven inflation. Wage growth slowed to 3.5% year-over-year (lowest since May 2021), providing slight relief on inflation fears, but the strong payroll number eliminates any dovish Fed pivot. CME FedWatch Tool now shows 78.9% probability rates remain unchanged through December, with only 13.6% odds of a single 25bp cut. Healthcare drove gains with 76,000 jobs (including 35,000 Kaiser Permanente strike workers returning), while construction added 26,000 and transportation/warehousing gained 21,000. The household survey showed labor force shrinkage, suggesting the unemployment drop may overstate labor market strength.
Blue Owl Capital capped private credit redemptions at 5% after experiencing unprecedented withdrawal requests in two major funds. The firm’s OTIC fund received redemption requests totaling 40.7% of assets in Q1, while flagship fund OCIC saw 21.9% redemption requests—both triggering gates designed to prevent fire sales. The move signals spreading contagion from AI disruption fears and marks the first major liquidity crisis in the $1.7 trillion private credit market. Tesla shares fell 5.5% after Q1 deliveries rose year-over-year but declined from the prior quarter. Globalstar surged 13% on Amazon acquisition speculation. Biogen announced acquisition of Apellis Pharmaceuticals, sending APLS shares up 136%. Trump signed executive order authorizing up to 100% tariffs on certain patented drugs. February trade deficit came in at $57.3 billion (up 4.9% from January but down 54.8% year-over-year). Precious metals continued their correction with gold around $4,675-4,700/oz and silver near $73/oz—both stabilizing after brutal March selloff. VIX declined to 23.87 from prior week’s 31.46, signaling reduced fear despite oil remaining elevated.
Weekly Performance
| Index | Close | Week Chg | %Chg |
|---|---|---|---|
| Dow Industrials | 46,505 | +1,338 | +3.0% |
| S&P 500 | 6,583 | +214 | +3.4% |
| Nasdaq Comp | 21,879 | +931 | +4.4% |
| Russell 2000 | 2,530 | +83 | +3.4% |
Treasury Yields
| Maturity | Yield | Wk Chg |
|---|---|---|
| 2-Year | 4.02% | — |
| 10-Year | 4.31% | -11bp |
| 30-Year | 4.88% | -10bp |
Commodities
| Commodity | Price | Week Status |
|---|---|---|
| Gold (spot, oz) | $4,703 | +6.1% |
| Silver (spot, oz) | $73.05 | +7.5% |
| WTI Crude (bbl) | ~$112 | Volatile |
| Brent Crude (bbl) | ~$112 | Elevated |
Weekly Movers
| Stock | Notable Move |
|---|---|
| Apellis (APLS) | +136% |
| Globalstar | +13% |
| Tesla (TSLA) | -5.5% |
| Blue Owl (OWL) | -4% |
| Nasdaq Overall | +4.4% (wk) |
Week Ahead
- April 6 Trump Deadline: President’s pause on Iranian energy strikes expires Monday. Market faces binary outcome: genuine Hormuz reopening protocol (rally continuation) or failed diplomacy (retest March lows). Pentagon’s 10,000-troop deployment suggests escalation remains likely despite Oman mediation.
- Private Credit Contagion: Blue Owl redemption gates mark first major liquidity crisis in $1.7T private credit market. Watch for spillover to other funds (Apollo, Ares, Blackstone). OTIC’s 40.7% redemption request suggests AI disruption panic spreading beyond public tech stocks into alternative investments.
- Fed Implications: March jobs blowout (178K vs 60K expected) with 4.3% unemployment eliminates dovish pivot despite oil at $112/bbl. Bond market pricing 78.9% probability of no action through December. Stagflation setup intensifies: strong labor + oil inflation + slowing growth.
- Technical Recovery: Week’s 3-4% rally barely dents correction damage. S&P still -3.4% from pre-conflict levels, Nasdaq -4.7%. VIX decline to 23.87 suggests reduced panic but remains elevated. Rally driven by short covering and diplomatic hope—fragile foundation.
- Earnings Season Looms: Q1 results begin mid-April with energy margins boosted by oil spike but airlines/transport crushed by fuel costs. Watch for widespread guidance cuts as Iran impact flows through supply chains. Tech faces AI disruption narrative + higher rates double-whammy.
Term of the Week
Redemption Gate: A liquidity protection mechanism in alternative investment funds that caps investor withdrawals at a specified percentage (typically 5-10%) during periods of abnormally high redemption requests, preventing forced asset sales that could damage remaining investors. Blue Owl Capital’s April 2026 implementation marks the first major test of gates in the burgeoning private credit market. When OTIC received redemption requests totaling 40.7% of fund assets and flagship OCIC saw 21.9% requests—both triggered by AI disruption fears driving investors from technology exposure—the firm invoked 5% quarterly caps embedded in fund documents. Gates exist because private credit lacks the daily liquidity of public markets: loans to mid-market companies cannot be instantly sold without steep discounts. The mechanism protects remaining investors by ensuring orderly portfolio management rather than fire-sale liquidations, but creates a classic liquidity mismatch: funds marketed on quarterly redemption terms suddenly become multi-year lockups. Historically, gates appeared during the 2008 financial crisis when real estate and hedge funds froze redemptions, and again in March 2020 when corporate bond funds faced runs. The Blue Owl episode reveals structural fragility in the $1.7 trillion private credit boom: rapid growth was fueled by yield-hungry investors accepting illiquidity premiums, but AI-driven job displacement fears (particularly for white-collar roles) triggered simultaneous exit attempts that exposed the emperor’s lack of clothes. Unlike bank runs where FDIC steps in or Fed provides backstops, private credit has no lender of last resort—gates are the only defense. For investors, the lesson is stark: alternative investments promising “quarterly liquidity” carry hidden duration risk that manifests precisely when you need access most. The coming weeks will test whether Blue Owl’s gates contain the panic or trigger contagion to Apollo, Ares, Blackstone, and KKR private credit platforms managing hundreds of billions in similarly illiquid assets.
