Asia Market Quick Take – 25 March, 2026

Key points:

• Macro: Washington sends 15-point proposal to resolve conflict
• Equities: Asian stocks surge as US-Iran ceasefire optimism lowers oil prices
• FX: USD strengthens on oil rebounds; AUDUSD dropped to 0.6938
• Commodities: Gold up as much as 1.8%, back above $4,500
• Fixed income: Treasuries reverses losses as 2 year yield remains under 3.9%

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Disclaimer: Past performance does not indicate future performance.

Macro:

• Washington seeks to end the Iran war with a ceasefire and a 15-point proposal. Despite Trump's troop deployment, these efforts are key. Oil prices rose 5% after Tehran denied talks and refused to restore Strait of Hormuz shipping, while US allies like Saudi Arabia and the UAE are ready to join the conflict.
• The US Composite PMI fell to 51.4 in March 2026, its lowest since last April, signalling slowing growth. Business activity hit an 11-month low due to softened orders and price surges. Services led the slowdown, while manufacturing stayed resilient. Confidence weakened, causing the first employment drop in over a year, with sharp input cost rises driving selling prices up.
• The US Manufacturing PMI increased to 52.4 in March 2026, surpassing expectations. Production and new orders grew, supported by stabilising export demand. Despite slowed employment growth and longer delivery times, business confidence reached a 13-month high amid reduced tariff worries and optimism over domestic demand.
• US nonfarm productivity grew 1.8% in Q4 2025, down from 2.8% estimated, and lower than Q3's 5.2% surge. Manufacturing productivity fell 2.5%. Annually, productivity grew 2.5% in Q4 but slowed to 2.1% for 2025, indicating a deceleration in efficiency gains.

Equities: 

• US - The S&P 500 slipped 0.2%, the Nasdaq fell 0.6%, while the Dow was flat. Geopolitical uncertainty intensified after Iranian media denied President Trump’s claims of progress in talks to end the four‑week conflict, sending Brent crude above $104 and lifting energy shares 2%, the only sector positive in March. Circle Internet and Coinbase experienced significant stock declines, falling 20% and 10% respectively after the clarity act changes prohibit platforms from providing yield on stablecoin balances. Salesforce fell 6% after missing revenue estimates for the 1^st time since 2006.
• EU - The STOXX 50 added 0.2% to 5,585 and the STOXX 600 rose 0.5% to 579. ASML outperformed after SK Hynix announced an $8 billion lithography equipment order. Chemicals gained as European natural gas prices eased, supporting names like Air Liquide and BASF, up 2.5% and 4%. Oil prices, however, kept rising amid worsening Middle East tensions. Banks lagged, with Nordea down 2.4% and ING off 1.4%. Softer March PMI data signaled energy‑driven pressure on activity.
• Asia - Asian markets are experiencing a strong rally on Wednesday morning, fuelled by optimism regarding US efforts to negotiate a ceasefire in the Middle East, resulting in declining oil prices and gains in US equity-index futures. Nikkei 225 advanced 2.9%, the Topix increased 2.3%, Kospi gained 3.1%, and ASX 200 rose by 2.0%. On Tuesday, Asian markets rebounded strongly after President Trump postponed attacks on Iranian energy infrastructure, easing Middle East conflict worries. The Hang Seng Index rose 2.8%, driven by gains from AIA Group and Laopu Gold. South Korea's Kospi surged 2.7% with major contributions from SK Hynix and Auk Corp. In Japan, the Nikkei 225 and the Topix increased by 1.4% and 2.1%, respectively, led by insurers and banks. Significant stock moves included Tokio Marine Holdings' rise due to a Berkshire Hathaway investment.

Earnings this week:

• Wednesday - Pinduoduo, Paychex, Chewy, Cintas, Beyond Meat, Baozun, Ondas Networks, Popmart, Kuaishou
• Thursday - Veritone, Designer Brands, Oxford, Commercial Metals Company, Meituan
• Friday - Carnival Corporation, The Metals Company, Super League, AutoPlus, Ping an, BYD

FX:

• USD tempered its initial gains against major G-10 currencies by Tuesday afternoon, influenced by falling oil prices and geopolitical developments, including the US deploying troops to the Middle East and rumors of a ceasefire. US business growth slowed, slightly affecting overall sentiment. DXY trading around 99 level.
• The USDCAD hit a two-month high near the 100-day moving average at 1.3787, while the euro slightly decreased to $1.1608 and the AUDUSD fell to 0.6938.
• The USDJPY and USDCHF experienced modest increases with USDJPY trading at 158.66 and USDCHF trading around 0.7872. A BoJ member suggested interest rate hikes to address the yen's weakness. Meanwhile, SNB President Martin Schlegel highlighted readiness to intervene due to increased Middle East tensions, noting negative rates have diminished the franc's attractiveness.

Commodities:

• Oil fell as reports of a US diplomatic push to end the Iran war overshadowed news of more troops, with Brent down as much as 4.4% to below $100 and WTI near $88, after Israel’s Channel 12 said Washington was seeking a one‑month ceasefire and the New York Times reported the US sent Tehran a 15‑point plan.
• Gold extended gains, rising as much as 1.8% to above $4,500 after reports the US is pursuing a diplomatic path to end the Middle East war, adding to a 1.6% rise after breaking a nine‑day slide, as Trump said Iran offered a “present” tied to Strait of Hormuz flows and Axios reported high‑level talks could come as soon as Thursday pending Tehran’s response.

Fixed income:

• Treasuries trimmed losses late on reports of a potential US–Iran ceasefire, but yields still closed higher, well off the day’s cheapest levels set after a weak $69 billion 2‑year auction and a WSJ report that around 3,000 82nd Airborne troops may be deployed to the Middle East. Poor auction demand and firmer oil rekindled inflation worries, lifting the 2‑year yield by as much as 10 basis points to 3.96% - intraday high - and leading gains across the curve.

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