Morning Brew March 3 2026

Good morning,

Risk Sentiment is under significant strain this morning due to concerns that an ongoing war in the Middle East might negatively impact the global economy through increased oil prices and heightened inflation. Currently, Oil and the USD are benefitting, while equities, particularly in Asia, are facing challenges. Gold remains relatively stable, whereas Silver is experiencing substantial pressure.

This heightened anxiety is driven by Iran's closure of the Strait of Hormuz and a warning from the US State Department advising American citizens to swiftly leave 14 Middle Eastern countries, including the UAE, Israel, and Egypt. Additionally, the US Embassy in Riyadh has been targeted by drones.

Charu took at look at the impact: Iran escalation The portfolio playbook | Saxo

• Iran escalation is not one market story. It sends shifting signals to investors. It typically hits portfolios through three shocks: oil, inflation/rates, and risk-off/liquidity.
• Many portfolios are unintentionally short oil and long duration, which can look diversified in calm markets but behave like the same bet in a shock.
• When oil is the driver, energy importers and fuel‑sensitive areas like consumer discretionary, airlines and hotels can suffer. When uncertainty is the driver, investors often look to energy, defence and gold as potential offsets.

Yesterday, we saw a strong rebound in US equities during the trading day, the S&P 500 closed marginally higher, the Dow decreased by 0.2%, and the Nasdaq rebounded positively from a 1.6% decline. Investors preferred cash-rich tech companies like Nvidia, which rose 2.9%, and Microsoft, which increased by 1.5%. Defense and energy stocks such as Northrop Grumman (+6%) and Exxon Mobil (+1.1%) lent support as oil prices remained elevated due to the Strait of Hormuz closure. Despite the ISM Manufacturing Index climbing to 70.5, indicating inflationary pressures, the market appeared unfazed by geopolitical tensions, with Palantir soaring 5.8%. Nvidia is making substantial investments of $2 billion each in Lumentum and Coherent

This morning, the US 500 has declined 0.9% to 6,820; the US 30 is down 0.8% to 48,460; and the US Tech 100 has fallen 1% to 24,700. The GER40 has dropped 1% to 24,375, and the Japan 225 is down 3.1% to 56,100. The Middle East conflict increases the likelihood that the Bank of Japan may delay rate hikes planned for March.

On the currency front, EURUSD has fallen below 1.17, trading at 1.1660; USDJPY is at 157.30; and GBPUSD is at 1.3350. Gold is at 5,305 and Silver at 84.50, with Silver testing its 50-Day Moving Average. The USD Index is at 98.70, and 10-year yields have risen to 4.06. Bitcoin remains stable at 68,000.

Any developments regarding escalation or de-escalation in the Middle East are likely to overshadow all othe

Tuesday, 3 March 2026

Eurozone Infaltion.

Central banks / Speeches Fed Williams, Kashkari

Earnings (selection)

Target, Target, Best Buy, AutoZone, CrowdStrike, Sea Limited, Box Inc, GitLab, Rayonier Advanced Materials, Paysafe

Wednesday, 4 March 2026

Australia GDP, China PMI, CH CPI, global PMI, EU PPI, US ADP

Central banks / Speeches Fed Beige Book

Earnings (selection)

Broadcom, Veeva Systems, Okta, Wix.com, Dycom, Stevanato Group, National Vision, Abercrombie & Fitch

Thursday, 5 March 2026

Sweden CPI, EU Retail Sales, US productivity Cost& Initial Jobless Claims,

Central banks / Speeches Bowman

Earnings – US

Costco Wholesale, JD.com, Kroger, Marvell Technology, Samsara, Pattern Energy, Ciena, GoPro, American Eagle, Victoria's Secret

Friday, 6 March 2026

US – Retail Sales Nonfarm Payrolls