Major U.S. stock indexes ended a volatile week higher, supported by tentative indications of easing tensions in the Middle East. On the economic front, consumer confidence saw a modest uptick, while U.S. manufacturing activity expanded for the third straight month in March.
In Europe, major indexes closed the week higher as investor sentiment improved on optimism that Middle East tensions might be shorter-lived than initially feared. However, inflationary pressures persisted, with eurozone CPI rising to 2.5% in March from 1.9% in February. Germany’s GDP forecast was revised down from 1.3% to 0.6%, reflecting weaker growth expectations.
Across Asia, Japan’s markets declined amid uncertainty stemming from geopolitical and energy market developments. Investors increasingly expect the Bank of Japan to raise interest rates at its April meeting. Meanwhile, the Shanghai Composite Index edged higher, buoyed by signs of improvement in China’s March PMI data.
U.S. President Donald Trump appeared increasingly open to winding down military engagement in Iran at the start of the week, offering initial relief to markets. Yet sentiment weakened midweek following a televised address that failed to specify a concrete timeline for de-escalation, driving oil prices higher as uncertainty over the Strait of Hormuz and Middle East supply risks kept volatility elevated.
| Asset Name | Weekly Closing Level | Weekly % Return |
|---|---|---|
| S&P 500 | 6,582.69 | 3.36% |
| DJIA (Dow Jones) | 46,504.67 | 2.96% |
| Nasdaq Composite | 21,879.18 | 4.44% |
| Nikkei 225 | 53,123.49 | 4.51% |
| FTSE 100 | 10,436.29 | 4.70% |
| Shanghai Composite | 3,880.10 | -0.86% |
| Sensex (BSE) | 73,319.55 | -0.36% |
| ADX Index (UAE) | 9,600.55 | 0.04% |
| Gold | 4,702.70 | 4.31% |
| Brent Oil (USD/bbl) | 109.03 | -3.14% |
Despite ongoing geopolitical challenges, U.S. equities have declined about 4% year-to-date following three consecutive years of robust double-digit gains. Market sentiment is likely to remain responsive to developments in the Middle East, keeping near-term volatility elevated. For long-term investors, such conditions often present selective opportunities. Meanwhile, the recent bond sell-off has improved yield prospects, underscoring the importance of staying invested and maintaining broad diversification across asset classes.
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Disclaimer
This commentary is provided for informational purposes only and does not constitute investment advice. For detailed insights, contact our investment team.