From the Desk - Economic Commentary
Brandon Casey, Member Strategies - 3/4/2026
U.S. markets continued to experience elevated volatility on Wednesday as investors monitored the escalating conflict involving the U.S., Israel, and Iran. Recent U.S.-Israel strikes on Iran have prompted ongoing Iranian retaliation, contributing to uncertainty across global markets. Treasury Secretary Scott Bessent stated on Wednesday that the U.S. will introduce measures to stabilize oil shipments through the Persian Gulf, noting that additional announcements on regional energy transport are forthcoming.
The ADP Employment Report showed U.S. private-sector payrolls increased by 63,000 in February, the strongest monthly gain since July 2025 and above expectations of roughly 50,000. Hiring was led by construction and education and health services, while professional and business services and manufacturing posted declines. Annual pay for job-stayers rose 4.5%, with pay growth for job-changers slowing to 6.3%t.
The ISM Services PMI rose to 56.1% in February from 53.8% in January, marking its highest reading since July 2022 and extending the sector’s expansion. Business activity increased to 59.9%, new orders advanced to 58.6%, employment improved to 51.8%, and prices eased to 63.0% while remaining elevated relative to recent norms.
Mortgage applications rose 11.0% in the week ending February 27, driven by continued strength in refinancing activity as mortgage rates held near multi-year lows. The refinance index climbed 14.3% and accounted for nearly 60% of total applications, while the purchase index increased 6.1%. The average contract rate for 30-year fixed-rate mortgages held steady at 6.09%.
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