Oil Shock Driving Markets: Is Risk-Off Back? 23/03/2026

HOT stories for today

Market wrap:

• Friday capped a bruising week for markets as President Donald Trump said outside the White House that he does not want a ceasefire with Iran. “You don’t do a ceasefire when you’re literally obliterating the other side,” he said. Energy was the only sector to finish the week in the green, up 3%. Utilities led Friday’s declines, falling 4.1%. The economic stakes of a wider conflict are becoming harder to dismiss: The Dallas Fed estimated this week that a Strait of Hormuz shutdown through June would cut global GDP growth by an annualized 2.9 percentage points in the second quarter. Brent traded near $105 on Friday after reaching $112 earlier in the week. Gold suffered its worst week since 1983, sliding more than 9% to about $4,500 as haven demand buckled under a stronger dollar and a Federal Reserve signaling it cannot ease into an oil shock. Treasury yields climbed, with the 10-year reaching 4.38%, while traders now see roughly a 50% chance of a Fed hike by October. A month ago, they were pricing in June cuts. 
• Airlines fell more than 2% Friday after the Transportation Secretary warned the DHS shutdown could bring air travel to “almost a grid halt” next week. With Congress leaving Washington for a two-week recess, the shutdown may drag into mid-April. The S&P 500 is down 5.5% since the war began. Little in this week’s action suggested the selling is over. In Asia, the selloff intensified on Monday. South Korea’s Kospi and Japan’s Nikkei each dropped more than 5%, while US stock futures also fell after Wall Street’s fourth straight weekly decline. Iran warned it could target Gulf energy facilities if the US follows through on its threat, helping lift crude in early Sunday trading. Investors now turn to Tuesday’s S&P Global Flash US PMI report as they assess whether geopolitical stress is starting to hit economic activity.

Markets Rattle as Oil Surges, Gold Slumps in Iran War

• Gold had its worst week in more than a decade, defying its usual haven role. Futures fell 9.6% to $4,574.90 even as geopolitical tensions intensified. The move highlights how difficult it is for markets to price a prolonged Iran conflict. Oil has surged, with Brent near $112 a barrel, fueling fears of renewed inflation and weaker global growth. The S&P 500 has dropped more than 5% since the war began, while the 10-year Treasury yield climbed to 4.39%, reflecting concern that higher energy prices could keep policy tight. President Donald Trump initially suggested the conflict would last four weeks or less. Three weeks in, there is little sign of an end. Instead of a typical flight to safety, cross-asset signals are breaking down. Gold and Treasurys are under pressure, the dollar is strengthening, and bitcoin is rising, an unusual mix that points to uncertainty over whether the bigger risk is war or inflation. Strategists say oil is the key transmission channel, given Iran’s influence over the Strait of Hormuz. Higher crude prices are already lifting fuel costs and could weigh on consumption and margins if they persist. Equities, though, still appear to be pricing a less severe outcome. Some investors are betting on a policy pivot — what Wall Street has dubbed “TACO,” or “Trump always chickens out.” Historically, geopolitical shocks have had only a modest and brief effect on stocks, but rising yields suggest bond markets are taking a more cautious view. For gold, the selloff reflects a shift in market drivers. A stronger dollar and higher real yields have outweighed haven demand, while the metal’s sharp rally over the past year left it vulnerable to profit-taking. The result is a market where traditional relationships are breaking down, and conviction is scarce.

Stocks on the move:

• Super Micro Computer (SMCI): Shares plunged more than 26% after U.S. prosecutors charged two employees and a contractor with smuggling Nvidia chips to China. 
• SolarEdge Technologies (SEDG): The solar stock jumped 14% after Jefferies upgraded it to hold from underperform, citing Middle East tensions that could revive energy-security dynamics similar to those that boosted demand during the Russia-Ukraine war.
• SM Energy (SM): Shares rose nearly 9% after JPMorgan initiated coverage with an overweight rating and a $40 price target, implying about 44% upside. The bank said higher oil prices could accelerate deleveraging and support increased cash returns.
• York Space Systems (YORK): The space and defense company gained 22% after reporting full-year revenue of $386.2 million, beating the $383.5 million consensus estimate compiled by FactSet.

Watchlist: SMCI, MU, ARM, AMZN, BA, COIN, SLV, NVDA

Key Economic Events Today:

EST time

No major economic news!


Earnings

BMO (Before Market Open): WeRide Inc. (WRD), Caledonia Mining Corp. (CMCL)


The TEFS Analyst team wishes you a successful day!