After a 3% fall in European equities yesterday, following a 3.5% plunge in Asian markets, the New York Stock Exchange limited its losses to 0.9%. This marks the second consecutive session with the same pattern: global equity markets tumble while Wall Street proves more resilient. It nonetheless required Donald Trump to roll up his sleeves to limit the damage. The President of the United States announced during the trading session that his country is ready to secure and escort tankers venturing through the Strait of Hormuz. The statement pushed oil prices lower, which had been overheating since this key transit zone had effectively been abandoned by oil tankers amid threats from the Iranian military and the growing reluctance of insurers. The respite proved short-lived, as the price of crude ultimately resumed its upward march. Yet the move was enough to halve or even divide by three the losses of Wall Street indices.

In the White House strategy aimed at neutralising the Iranian regime, the oil dimension had inevitably been factored in. The surge in prices is a broad-based poison for most segments of the economy. It is also a political poison, because consumers quickly feel the effects, first at the pump, then more widely through energy bills and, ultimately, in the price of goods and services. This is why Donald Trump is trying to extinguish this particular fire rather than the others, having failed to anticipate it properly. If crude prices remain elevated, they will also undermine hopes for interest rate cuts from the Federal Reserve. Traders have clearly grasped the point: they have pushed back their bets accordingly. This is one of the reasons why the usual rush into US Treasuries, traditionally regarded as safe-haven assets, has not driven bond yields lower in the United States. Quite the opposite has occurred.

The rise in oil prices stems from fears over energy supply. In the depths of the Gulf, several producers have announced the suspension or restriction of deliveries of key products such as LNG and diesel. In the short term, these imbalances can be offset. Behind the scenes, however, they have already triggered a scramble to secure supplies. And heightened demand inevitably means rising prices. The outlines of a vicious circle are already becoming visible.

The situation has revived an unpleasant memory: the year 2022 and the energy crisis in Europe following Russia's invasion of Ukraine. Market participants have not forgotten. In the United States, the memory is not driven by pure empathy for Europeans but because the episode helped trigger the worst year for equities since the 2008 financial crisis. For a generation of investors accustomed only to rising markets, 2022 remains the closest thing to a market disaster. The S&P 500 fell 19.4%. The Nasdaq dropped 33%. That year, equities and bonds declined simultaneously, which is far from typical. There were few places to hide. Hence the current sense of apprehension. Here again, Trump is well aware of the stakes. He can hardly afford an energy cataclysm only months before the midterm elections after launching an unpopular foreign offensive. It is therefore highly likely that his administration will deploy every possible means to bend the rise in oil prices. And quickly, because the longer the situation drags on, the greater the economic damage. The only problem with this kind of crisis is that there is no protocol guaranteeing a return to normality.

Global equity markets have clearly understood the risk. Losses exceeding 3%, such as those recorded in Europe yesterday, are rare. France's CAC 40 has fallen 6% in two sessions and has lost many of its reference points. How can one tell that the stock market is suffering a nervous breakdown? When price moves stop making any sense. The punishment has been even more spectacular in Asia, where some markets, notably Japan and South Korea, had been caught in a prolonged bullish frenzy. South Korea's KOSPI is down another 10% this morning after collapsing 7% the previous day. Excesses tend to carry a heavy price. Wall Street will probably continue to benefit from a repatriation of American capital that had ventured abroad in search of a touch of exoticism in Asia and Europe. Yet the negative forces remain powerful as long as no easing emerges in the Middle East.

A handful of corporate earnings releases will briefly divert attention from the war in Iran. ASM International, Adidas, Bayer and Continental reported results between last night and this morning in Europe. In the United States, attention will turn to Broadcom this evening after the close. On the macroeconomic calendar, Australia reported overnight GDP growth broadly in line with expectations. In China, the RatingDog PMI indicators came in above forecasts. In the United States, ADP employment data will precede the ISM services index.

Asia-Pacific markets are therefore posting spectacular declines in Tokyo, Seoul and Taiwan. Hong Kong, India and Australia are faring slightly better but are still down around 2%. European futures indicators are hovering around the flat line following Wall Street's relative resilience yesterday, although volatility remains high and could reverse the trend at any moment.

Today's economic higlights:

On today's agenda: Australia's quarterly and annual GDP growth rates; China's NBS Manufacturing and Non-Manufacturing PMIs along with RatingDog Manufacturing PMI; consumer confidence in Japan; annual inflation rate in Switzerland; services PMIs in Spain and Italy, followed by unemployment rates in Italy and the Euro Area; in the United States, the MBA 30-Year Mortgage Rate, ADP Employment Change, ISM Services PMI, and EIA Crude Oil and Gasoline Stocks Changes. See the full calendar here.

  • GBP / USD: US$1.33
  • Gold: US$5,152.69
  • Crude Oil (BRENT): US$83.72
  • United States 10 years: 4.07%
  • BITCOIN: US$68,419.4

In corporate news:

  • Rio Tinto and the Western Australian government announced a partnership to expand the Dampier seawater desalination plant, aiming to deliver 8 gigaliters of water annually.
  • Tinicum Inc and Blackstone confirmed a preliminary all-cash proposal for Senior plc, with a decision deadline set for March 31.
  • GSK completed the acquisition of RAPT Therapeutics for $2.2 billion, including the monoclonal antibody ozureprubart in phase IIb trials.
  • Bluefield Solar reported a lower net asset value of £683.3 million but raised its interim dividend to 2.25p per share.
  • XP Power reported a 7% revenue decline to £230.1 million but noted a 24% increase in order intake for the year.
  • Rosebank Industries announced plans to acquire MW Components and CPM for $3.05 billion, financed through a capital raise and new debt facilities.
  • Pensana confirmed that construction at its Longonjo rare earth project in Angola is on track for commissioning in 2027.
  • Adidas issues a 2026 forecast below expectations.
  • Bayer targets €9.6–10.1bn in EBITDA this year.
  • ASM International raises its 2026 guidance thanks to a rebound in sales in China.
  • Novo Nordisk receives a second FDA warning over misleading advertising for Ozempic.
  • Aroundtown announces a takeover offer for 47.45 million shares of Grand City Properties.
  • Aedifica acquires 80% of Cofinimmo’s shares.
  • CIE Automotive completes the acquisition of the Aludec Group.
  • Subsea 7 announces the retirement of CEO John Evans on June 30, 2026.
  • Lufthansa Group has suspended flights to the Middle East until at least March 8 and is offering affected passengers refunds or rebookings.
  • Ross Stores rises 6% in after-hours trading following its quarterly results.
  • OpenAI / Microsoft OpenAI is developing an alternative to GitHub, according to The Information.
  • Meta plans to create a new applied artificial intelligence engineering organization, according to the WSJ.
  • Intel announces the retirement of board chairman Frank Yeary after the annual shareholder meeting in May.
  • Levi Strauss completes the sale of Dockers to Authentic Brands Group.
  • Trane Technologies completes the acquisition of Liquidstack.
  • Telus Corporation / AST SpaceMobile partner to deploy satellite-based cellular broadband service across Canada.

See more news from UK listed companies here

Analyst Recommendations:

  • Hikma Pharmaceuticals Plc: Berenberg maintains its buy recommendation and reduces the target price from GBX 2300 to GBX 1800.
  • Intertek Group Plc: Bernstein maintains its market perform recommendation and reduces the target price from GBX 5000 to GBX 4600.
  • Greggs Plc: Barclays maintains its overweight recommendation and reduces the target price from GBP 20.40 to GBP 19.10.
  • Segro Plc: UBS downgrades to neutral from buy and raises the target price from GBX 815 to GBX 840.
  • Wise Plc: JP Morgan maintains its overweight recommendation and reduces the target price from GBP 13.85 to GBP 12.25.
  • Shell Plc: Jefferies maintains its buy recommendation and raises the target price from GBP 34 to GBP 35.
  • Tesco Plc: UBS maintains its buy recommendation and raises the target price from GBX 500 to GBX 530.
  • Marks & Spencer Group Plc: Goldman Sachs maintains its buy recommendation and raises the target price from GBX 470 to GBX 480.
  • Unite Group Plc: Goldman Sachs maintains its buy recommendation and reduces the target price from GBX 880 to GBX 680.
  • J Sainsbury Plc: Goldman Sachs maintains its buy recommendation and raises the target price from GBX 370 to GBX 390.
  • Rio Tinto Plc: Argus Research Company maintains its buy recommendation and raises the target price from USD 85 to USD 115.
  • Fresnillo Plc: UBS maintains its neutral recommendation and reduces the target price from GBX 4100 to GBX 4000.