Day 7: Russia and China are in

Good morning! First full week of war is behind us.

I just made my kopi and sat down to write this, and honestly the numbers I'm looking at are not small. This has been the most eventful 7 days in markets since COVID. So let's break it down properly.

🏳️ "Unconditional Surrender." No Negotiations.

Trump posted on Truth Social yesterday that “there will be no deal with Iran except UNCONDITIONAL SURRENDER!" Full caps. No ambiguity.

He told reporters he doesn't even care if Iran becomes a democracy after this. He just wants a leader who treats the US and Israel "well." And he's already said publicly he wants to be involved in picking that leader himself.

Iran's foreign minister fired back the same day, saying that Iran has not asked for a ceasefire and is rejecting all negotiations.

So that's where we are. Two sides, both digging in. No off ramp in sight.

For investors, this is the most important update of the week. Regime change is the stated goal. Regime change takes months, not days. Plan accordingly.

🪖 Russia Just Entered the War

This is the development that changes the plans completely.

Multiple intelligence sources confirmed that Russia is now providing Iran with real time intelligence on the locations and movements of US troops, ships and aircraft. Putin and Iran's president held a phone call Friday and "agreed to continue contacts."

Iran's foreign minister confirmed Russia and China are assisting Iran "politically and in other ways."

And the kicker? Russia's Kremlin spokesman told reporters they are seeing "a significant increase in demand for Russian energy resources" because of this war. Moscow has a direct financial interest in this conflict dragging on. Every day the Strait stays closed, Russian oil gets more valuable. 🇷🇺

This war just got a lot more complicated. Russia is helping Iran but has little interest to end the war? That’s some 4D chess here.

💣 The Bombing Is Intensifying, Not Slowing

Research group Airwars published a report on Fri confirming the US and Israel struck more targets per day in the first four days of this operation than any military campaign in recent decades. More than Gaza. More than the campaign against ISIS.

Israel claims it has now achieved near complete air superiority over Iran, destroyed 80% of Iran's air defence systems, and carried out 2,500 strikes total.

Iran has fired its 23rd wave of strikes at Israel. Qatar has been hit. UAE intercepted over 120 drones in a single day. Bahrain's oil refinery was struck. 20,000 Americans have now left the Middle East.

This is not winding down. If anything, both sides are escalating.

One of the largest LNG plant in Qatar has halted production. This is going to have a big impact as natural gas is the key feedstock, accounting for around 80% of the raw material cost.

This is going to have an impact on inflation.

📊 What Markets Told Us Last Night (Fri 6 Mar)

Wall Street just closed out its worst week since October. And Friday was the ugliest day of the week.

Two things hit at the same time. First, oil broke above $90 a barrel, its highest since 2023, after Trump's "unconditional surrender" post spooked energy markets. WTI crude finished the week up 35%, the biggest single week gain for oil since futures trading began in 1983. Let that sink in.

Second, the February jobs report dropped a bomb. The US economy lost 92,000 jobs last month. Economists had expected a gain of 55,000. The unemployment rate ticked up to 4.4%.

The combination of rising inflation AND a weakening economy is the nightmare scenario for markets. Investors have a word for it: stagflation. The Fed cannot cut rates to help growth because oil is pushing inflation higher. They cannot raise rates to fight inflation because the economy is already softening.

In short, they are stuck.

All three major indexes are now negative for 2026. The Dow is having its worst week since October. Small cap stocks (Russell 2000) fell 2.3% on Friday alone and are nearly flat on the year.

The only sector in the green all week? Energy. Up over 25% in 2026 now.

🧠 Pete's Take: The Week That Changed Everything

One week ago this was a normal market worried about AI valuations and Fed policy. Today we are talking about stagflation, regime change, Russian intelligence sharing, and $90 oil.

Here is what I think you need to hold in your head going into next week.

The jobs number on Friday was a warning shot. If oil stays above $90, companies start cutting costs fast. That means more layoffs. Which means weaker consumer spending. Which means earnings get hurt. That is the chain reaction investors are starting to price in.

Qatar's energy minister said publicly this week that if the war continues a few more weeks, oil could go to $150. His words, not mine. At $150, you are looking at global recession territory.

I am not saying that is the base case. But it is on the table.

What am I watching next week?

The CPI inflation data releasing on Wed. If energy costs are already showing up in that print, the Fed's hands get even more tied.

Oil at $95 or above. That is the next psychological level. If we break through, the tone in markets shifts sharply.

Any diplomatic signal. China's foreign minister is actively trying to mediate. Trump is meeting Xi on 31 Mar. That summit just became the most important meeting of 2026. If there is any back channel movement before then, markets will react instantly.

Defensively positioned portfolios are outperforming this week. Energy, gold, defence. That rotation is not done.

Position. Don't predict. Stay patient. 🎯

And finally my new course, Dividend Market Genius , is officially launched!

I’m very humbled by the overwhelming response with more than 200 sign ups already!

Dividend Market Genius could not have launched at a better time as the war brings uncertainty, the DMG strategies bring cashflow to fund our life experiences!

For those of you who missed it, you can watch the replay here: https://investwithpete.teachable.com/courses/dmg/lectures/65028151

The DMG promo launch price is here: https://rebrand.ly/DMG500 

Make sure you get it before promo ends next Sunday!

For those signed up for DMG already, the first LIVE zoom class is 27th Mar! Will send out more details soon!

Happy Hunting!

Pete
Invest with Pete

🚨‼️ By the way, I’ll never PM anyone on telegram or any other social media platforms. If you receive any “Pete” messaging you, these are scammers impersonating me. Pls beware!

The information provided in this newsletter is for informational purposes only and does not constitute financial advice. Readers should seek their own independent financial advice before making any investment decisions. Please note that while Pete is a portfolio manager, the opinions expressed in this newsletter are his own and do not represent the views of any organization. Always perform your own research and due diligence before investing.