Hey Snackers,
A new statewide law came into effect in New York on Saturday requiring food stores and retail establishments to allow customers to pay in cash. However, the rule doesn’t apply to bills in denominations above $20, which you wouldn’t think would be a problem, except that there are more $100 bills than any other denomination in circulation.
The S&P 500 and Nasdaq 100 fell on Tuesday, paring steeper losses after a midday report that Iran is willing to listen to proposals to end the war, but stocks were unable to keep their momentum as traders digested news that the US is deploying 3,000 troops to the Middle East. After the market closed, reports emerged that the US has sent a plan to Iran to end the war, sending stocks up and oil down in the aftermarket session.
How much does oil matter for inflation anyway?
As markets await the first Consumer Price Index print measured since the start of the Iran war, slated for April 10, it’s worth stepping back and asking one important question: how much does oil matter for inflation anyway?
Energy is only about 6% of the CPI, but that’s not the full picture.
That is significantly lower than it was back in 2012, when energy was more than 10% of the index — and, of course, when prices spike, people have to spend more on those goods, which is why the weight of energy in the CPI basket jumped after Covid in 2022.
Of course, while the share of energy contributing to the CPI directly might be lower than what many people expect, higher oil and energy prices affect nearly everything else indirectly.
Food prices, making up ~15% of the index, are sensitive to fertilizers, which are often produced using natural gas, as well as transportation costs. Airfares, worth 0.8% of the index, are already rising.
Supply chains across nearly every physical industry in America are impacted by more expensive barrels of oil.
Indeed, RBC analysts project that if oil prices settle around $100 per barrel, US inflation would rise above 3.5% from Q2, about 0.7 percentage points higher than the base case. IMF analysis estimated last week that every 10% increase in energy prices, if sustained for a year, would result in a 40-basis point increase in global inflation.
The Takeaway
For now, traders in prediction markets* are expecting a chunky rise in headline inflation, with the majority expecting CPI to rise 3.2% for March. Even if the war in Iran were to end, oil prices are likely to remain elevated. In addition to the increased costs of shipping oil through the Strait of Hormuz — whether that involves paying the Iranians or merely just factoring in the higher price of insuring the vessels that transport oil and the valuable cargo within — a significant amount of fossil fuel infrastructure has been damaged and a number of facilities have ceased processing. Getting those facilities back online will take time, so for now pricey oil is going to stick around for a bit.
*Event contracts are offered through Robinhood Derivatives, LLC — probabilities referenced or sourced from KalshiEx LLC or ForecastEx LLC.
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Trade the market, not just the tickers
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America is officially spending more on building data centers than offices
It’s finally happened: spending on data center construction surpassed offices for the first time at the end of last year.
America’s construction spending on data centers reached a record annualized rate of $45 billion in December, crossing paths with declining private office outlays at $44 billion, per US Census Bureau data.
Recently, research from CBRE found that data center capacity under construction actually fell from 6.35 megawatts in 2024 to 5.99 megawatts by the end of 2025 — but the bottleneck doesn’t appear to be demand, but more mundane supply issues, with deal implementation at the local level, including slow permitting and constrained supply chains, seemingly causing the slowdown.
Indeed, considering how hyperscaler clients are trying to secure power capacity, it’s hard to imagine data center spending not expanding its lead.
Just last week, Meta signed a five-year AI infrastructure deal with Nebius worth up to $27 billion.
The Takeaway
With skyrocketing demand, construction costs are jumping, too — helping construction firms to become the best-performing non-Iran-related segment of the stock market this year, as Sherwood News Senior Markets Correspondent Matt Phillips pointed out.
FCC bans foreign-made routers over national security concerns
One of the most boring and ubiquitous pieces of modern consumer technology is suddenly in the crosshairs of the Trump administration. It turns out your dusty internet router that’s probably from China is a favorite target for cyberattacks.
Snacks Shots
⚾️ MLB: It’s Opening Day! The victors of the 2025 season, the Los Angeles Dodgers, have a 29% chance of repeating, according to prediction markets, with other strong contenders including the Seattle Mariners (9%) and New York Yankees (9%).
🌇 Los Angeles: The Dodgers seem poised for another great year; markets are pricing in a 53% chance they clear at least 100 wins. It’s a long shot, but there’s even a 7% chance that the Dodgers get over 115 wins this season, which would put them in striking distance of the record. Star player Shohei Ohtani has a 43% chance of leading the league in runs heading into the season, and pitcher Yoshinobu Yamamoto — the hero of Game 7 — has the third-best chances of winning the National League’s Cy Young award this season.
🏔️ Colorado: The leading contenders for the worst record in MLB are the Colorado Rockies, with a 55% chance of finishing the year with the worst record. Last year Colorado finished the season 43-119, one of the worst seasons in the modern era, becoming the first team to open a season with 19 consecutive losses.
What else we're Snackin'
OpenAI is discontinuing Sora and focusing on its next major AI model, “Spud,” leading Disney to end its deal with the firm
Tesla’s European sales rose for the first time in more than a year, but still lag BYD
Meta and Arm are teaming up to build a new class of data center chips
Game over? Nintendo is reportedly cutting back on Switch 2 production and “Fortnite” maker Epic is laying off 1,000 people
Analyst says traders are itching for a reason to start buying bitcoin again
Snack Fact of the Day
United’s CEO said airfares would have to go up another 20% to “break even” if fuel prices remain elevated.
Wednesday
Earnings expected from Chewy and Beyond Meat
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