Market Quick Take – 4 March 2026

Market drivers and catalysts

• Equities: Risk-off hit equities as energy shock fears rose, with Europe sliding most, while US and Asia also retreated.
• Volatility: Iran escalation, oil above $82, elevated hedging, downside skew
• Digital Assets: Bitcoin steady, IBIT inflows, macro sensitivity
• Fixed Income: US Treasury yield spike moderates. High yield bonds under pressure
• Currencies: US dollar strength eased Tuesday. EM currencies steady after Tuesday drubbing.
• Commodities: Oil pulling back higher after rally capped Tuesday. Precious metals steady after steep Tuesday sell-off
• Macro events: US Feb. ADP Employment Change, US Feb. ISM Services, Fed Beige Book

Macro headlines

• The US-Israel war with Iran enters its fifth day. US President Trump stated that Iran's military capabilities are severely reduced, and promised to insure shipping through the Strait of Hormuz with US Naval escorts, though the practicability of this idea was questioned. The US Senate plans to vote on the Iran war powers resolution. Iran targeted Al Udeid base in Qatar and threatened regional economic centers, while their new defense minister was reportedly killed. Israel struck Iranian leadership in Tehran, and tensions with Hezbollah are rising. The UAE is considering military action against Iran's missile and drone strikes.
• Australia's economy grew 0.8% in Q4 2025, up from 0.5% in Q3, beating the 0.6% forecast and marking the 17th consecutive quarterly growth. Annual GDP increased 2.6%, surpassing the 2.2% expectation and was the fastest since Q1 2023.
• UK Finance Minister Rachel Reeves presented the Spring Statement, updating on growth and finances amid Middle East uncertainties. The OBR forecasted 2026 growth at 1.1%, down from 1.4%, with future years raised to 1.6%. Despite inflation challenges, defense spending and infrastructure investment were emphasized. The government targets meeting fiscal rules by 2029/2030 with £23.6 billion borrowing headroom, prioritizing the Autumn Budget for major policies.
• Euro Area annual inflation rose to 1.9% in February 2026, up from 1.7% in January and exceeding expectations. Services inflation accelerated to 3.4%, and non-energy industrial goods inflation rose to 0.7%. Energy prices continued to decline but at a slower rate, down 3.2%. Core inflation rebounded to 2.4%. Among major economies, HICP rose in France, Spain, and Italy, while slightly easing in Germany.

Macro calendar highlights (times in GMT)

0730 – Switzerland Feb. CPI
0730 – Sweden Feb. PMI
1000 – Eurozone Jan. Unemployment Rate
1315 – US Feb. ADP Employment Change
1500 – US Feb. ISM Services
1530 – Canada Bank of Canada Governor Macklem to speak
1900 – US Fed Beige Book

Earnings this week

• Today: Broadcom, Bayer, Adidas, Dassault Aviation, Veeva Systems, Continental
• Thursday: Costco, Petrobras, Marvell Technology, Merck, Deutsche Post, Reckitt Benckiser, Ciena, Galderma, Kroger, Universal MusicGroup, JD.com, Aviva
• Friday: OTP Bank

For all macro, earnings, and dividend events check Saxo’s calendar.

Equities

• USA: The S&P 500 fell 0.9% to 6,816.63, the Dow Jones Industrial Average slid 0.8% to 48,501.27, and the Nasdaq Composite dropped 1.0% to 22,516.69. Stocks clawed back from steeper early losses after President Trump said the U.S. Navy would escort tankers through the Strait of Hormuz, cooling the worst oil-panic pricing. Target jumped 6.8% after topping expectations and lifting its full-year profit outlook, while AT&T rose 2.4% as it reaffirmed its 2026 and multi-year guidance. Sea Limited sank 16.5% on cost growth, and Blackstone slipped 3.8% after net outflows at its flagship private-credit fund. Markets now watched energy prices and any further policy steps around trade and shipping.
• Europe: European stocks extended the sell-off as energy-supply fears dominated, with the Euro STOXX 50 down 3.6% at 5,771.73 and the STOXX Europe 600 lower by 3.1% to 604.44. Oil and gas price spikes revived inflation worries and pushed rate expectations more hawkish, which hurt banks and cyclicals that depend on cheap energy and calm trade routes. Beiersdorf plunged 20.1% after a downbeat profit-margin view, HSBC fell 5.2% with lenders under broad pressure, and Air France-KLM slid 7.9% as fuel and route risk hit travel. Naturgy dropped 7.4% after BlackRock sold its remaining stake, while investors looked next to inflation prints, central bank messaging, and whether the Middle East risks eased.
• Asia: Asian markets were under pressure Wednesday on top of sharp losses Tuesday as the fall-out of the Iran conflict spread and possibly on leveraged players feeling a squeeze, especially in South Korea as the KOSPI was down late Wednesday in Asia by over 12% in its worst single day losses since 2008. Japan’s Nikkei 225 was down more than 3.5%, and the Topix down a similar amount, while Hong Kong’s Hang Seng was off over 2.5%. Export-heavy and rate-sensitive sectors took the hit as investors priced higher inflation risk and a slower path to rate cuts. Samsung Electronics dropped another 6.5% after Tuesday’s steep losses and SK Hynix fell over 4.5% after Tuesday’s 12.0% drop as foreign selling hit chip leaders, while Xiaomi slid 4.4% as Hong Kong tech stayed under pressure. One exception was defence, with Hanwha Aerospace jumping 19.8%. Markets now watch any signal that key energy supply routes remain open.

Volatility

• Volatility remains elevated as markets digest the second full trading day after the US and Israeli strikes on Iran. The core concern is not only the geopolitical escalation itself, but the potential spillover into global energy supply, inflation expectations and central bank policy. Brent crude is holding above $82 per barrel, keeping investors alert to the risk of a renewed inflation impulse if tensions escalate further. Markets are currently trading headline to headline, with oil acting as the main transmission channel into equities and bonds.
• The CBOE Volatility Index (VIX) closed at 23.57 on Tuesday, while short-dated measures such as VIX1D (20.30) and VIX9D (24.55) remain elevated. This confirms that near-term hedging demand is still present, but not at panic levels. In other words, investors are cautious, not capitulating.
• Options pricing currently implies an expected move of approximately ±113.5 points (±1.67%) in the SPX into Friday, 6 March (based on current weekly options pricing from your snapshot). For today’s expiration, puts are priced richer than comparable calls, indicating that investors continue to pay a premium for downside protection. That skew signals a defensive tilt remains in place as geopolitical uncertainty persists.
• In practical terms, the direction of oil will likely determine the next move in volatility. If energy prices stabilise, implied volatility could ease quickly. If crude continues higher, inflation concerns may keep hedging demand elevated across asset classes.

Digital Assets

• Digital assets are once again trading as macro-sensitive risk assets. Bitcoin is holding in the high-$68,000 area, while Ethereum trades near $2,000, with price action driven more by geopolitical headlines and broader risk appetite than by crypto-specific catalysts.
• ETF flows remain a key support factor. US spot Bitcoin ETFs recorded net inflows of $225.2 million on 3 March, driven primarily by strong demand for IBIT (+$322.4 million). IBIT closed at $38.70 on Tuesday, underlining its role as the dominant institutional vehicle for Bitcoin exposure.
• On the Ethereum side, flows were more mixed. ETHA saw +$41.9 million in inflows, yet total US spot Ethereum ETF flows were slightly negative (-$10.8 million), reflecting offsetting outflows elsewhere. ETHA closed at $14.93. This suggests selective positioning rather than broad-based accumulation.
• Among major altcoins, Solana and XRP remain steady but highly headline-sensitive. For now, the crypto complex appears cautious yet resilient: supported by ETF demand, but constrained by macro uncertainty and energy-driven inflation concerns.

Fixed Income

• The spike in US treasury yields moderated Tuesday, as the benchmark 2-year yield peaked at just under 3.60% before rolling back closer to 3.50%, while the benchmark 10-year treasury yield peaked above 4.11% before easing back to below 4.05% at one point and then rebounding in Asia’s Wednesday session to 4.07%.
• US high yield corporate bonds came under pressure, with the Bloomberg measure of high yield spreads to US treasury yields widening six basis points to 295 basis points, the highest level since November.
• Japanese government bonds steadied with yields from 2-years and out to 10-years easing back, while longer yields nudged slightly higher.

Commodities

• Key commodities impacted by the Middle East conflict remain on an elevated-risk, supply-driven footing, with higher oil prices threatening to deliver a new inflationary shock to the global economy.
• Brent crude briefly touched USD 85 on Tuesday before easing, only to rebound again after President Trump promised that the U.S. would protect and insure vessels sailing through the Strait of Hormuz — a pledge many in the market view as unrealistic under current conditions. Shipments of crude, refined fuels, gas and fertilizers have almost ground to a halt amid surging freight costs and a lack of insurance coverage. Prices have since moved back above USD 82 as the risk of production halts increases, with some producers inside the Strait reportedly running short of storage capacity.
• European and Asian LNG prices meanwhile surged to more than three-year highs after Qatar — a major exporter — halted production, forcing buyers to compete for a smaller pool of available supply, particularly from the United States. Norway has also indicated that current export capacity is already running close to maximum levels.
• Weakness in precious metals during Tuesday’s broad deleveraging episode and a stronger dollar pushed gold briefly back to around USD 5,000 before fresh buying emerged as concerns grew that the Middle East situation could deteriorate further in the near term.

Currencies

• The US dollar strength peaked and rolled over on Tuesday as risk sentiment steadied in the US equity market session. EURUSD bottomed with a spike to 1.1530 before rebounding to 1.1625 and then carving out a new range on either side of 1.1600, while USDJPY peaked just shy of 158.00 Tuesday before pushing back below 157.40 by late Asian hours Wednesday.
• The Australian dollar saw broad weakness Tuesday before steadying later in the session, as metals prices suffered a steep markdown on the day and perhaps as long positions in one of the best performing currencies were squared. AUDUSD saw a slide from above 0.7100 to just below 0.6950 before rebounding to 0.7050, trading 0.7020 late Wednesday in Sydney.
• EM currencies saw significant volatility versus the US dollar on global market turmoil and USD strength Tuesday, with the moves partially arrested as risk sentiment steadied. USDMXN lifted Tuesday over 3%, from 17.30 to as high as 17.87, trading 17.70 in Asia Wednesday. USDZAR lifted from 16.10 to 16.75 before easing back to 16.51.

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