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Sharp rebound as Trump signals possible de-escalation

Amid a potential further escalation of the Middle East conflict stock markets initially dived at the start of this week’s trading but then recovered losses, as US President Trump that he would postpone strikes on Iranian power and energy facilities for five days following what he called "productive" talks. Following Trump’s statement, the Dow jumped more than 1100 points and oil prices dropped more than 12%. However, markets remained cautious, as Iranian state media denied the existence of direct talks and analysts warned that even if the conflict ends soon, the recent spike in energy prices and market volatility is likely to leave a meaningful economic footprint.

  • Date
  • Auteur Alessandro Fezzi, Content & Publications
  • Temps de lecture 5 minutes

Volatility
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US stock indices recovered on Monday as comments from US President Donald Trump raised tentative hopes of easing tensions in the conflict with Iran, after he paused planned strikes on Iranian energy sites for five days citing "productive talks". The Dow Jones Industrial Average rose 1.4% to 46,208.47 points after hitting its lowest level since September on Friday, while the broad S&P 500 gained 1.2% to 6581.00 points and the technology-heavy Nasdaq 100 added 1.2% to close at 24,188.59 points. 

Asia-Pacific markets trim gains as oil rebounds

Equity markets in Asia advanced on Tuesday but gave up part of their early gains as oil prices rebounded, reflecting continued uncertainty around the conflict involving Iran. Brent crude futures for May climbed more than 3.5% to about USD 103.7 per barrel and West Texas Intermediate rose 4% to roughly USD 91.7, after Brent had slumped nearly 11% on Monday following a spike above USD 112 on Friday. Major indices including Japan’s Nikkei 225, South Korea’s Kospi, Australia’s S&P/ASX 200, Hong Kong’s Hang Seng index and China’s CSI 300 all traded higher, while Japan’s inflation slowed for a fourth consecutive month in February to 1.3% from 1.5% in January, moving further below the Bank of Japan’s 2% target as cooling food prices and fuel subsidies weighed on consumer prices. Market sentiment in Asia was supported by the strong rally on Wall Street on Monday.

Euro-area consumer confidence weakens in March

Consumer sentiment in the euro area deteriorated more than expected in March, likely reflecting concerns about the Iran war, higher oil prices and rising inflation risks. The European Commission reported on Monday that its consumer confidence indicator fell by four points to minus 16.3, the lowest level since October 2023, compared with economists’ expectations for a decline to around minus 14.2. The indicator remains below its long-term average.

European shares rebound despite conflict fears

European stock markets reversed sharp early losses to close mostly higher on Monday as investors reacted to mixed signals over the conflict involving Iran. The euro area blue-chip EuroStoxx 50 index climbed 1.3% to 5574.32 points after briefly dropping to its lowest level since September at 5376 points amid fears that Iran could further attack energy infrastructure in the Gulf and potentially close the key Strait of Hormuz. Switzerland’s SMI also recovered to end 0.6% higher at 12,389.68 points.

Corporate and economic calendar

Corporate news in focus: There is no major corporate news scheduled today.

Economic data in focus: French Purchasing Managers’ Index (09:15), German Purchasing Managers’ Index (09:30), euro-area Purchasing Managers’ Index (10:00), UK Purchasing Managers’ Index (10:30), US ADP National Employment Report (13:15), US Purchasing Managers’ Index (14:45), Richmond Fed Manufacturing Index (15:00), Bundesbank monthly report (12:00), Swiss National Bank Chairman Martin Schlegel speaks (18:00). 

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Publisher: LGT Bank (Switzerland) Ltd., Glärnischstrasse 36, CH-8027 Zurich
Editor: Alessandro Fezzi
Source: LGT Bank (Switzerland) Ltd.