Market drivers and catalysts
Equities: Global equity markets absorbing the impact of the US-Israeli attacks on Iran. US futures down over 1% and European futures opening down over 2% from Friday close.
Volatility: Geopolitical escalation, oil sensitivity, VIX near 20, skew elevated
Digital Assets: Risk-off tone, BTC ~$65.9k, ETH ~$1.93k
Fixed Income: US treasury yield rise slightly from low Friday close, with benchmark 10-year yield still below key 4.00% level.
Currencies: US dollar surges as the clear safe-haven among currencies after attacks on Iran. Norwegian krone higher on surge in oil prices.
Commodities: Brent crude rise 6 dollars per barrel on US-Israel attack on Iran. Gold up over USD 100 per ounce.
Macro events: US Feb. ISM Manufacturing
Macro headlines
Joint US-Israeli strikes on Iran have escalated tensions in the Middle East and impacted global markets, from oil and gold and silver prices to risk sentiment more broadly. Concerns are rising over disruptions in the Strait of Hormuz, a key oil passage. Tehran claims it's open, but shipping companies are rerouting, in part on prohibitive additional insurance costs. Iran attacked US assets in neighboring countries like the UAE and Iraq and even civilian infrastructure in the United Arab Emirates. Early Monday, Israel extended its attacks to targets in Lebanon.
In January 2026, US producer prices increased by 0.5%, exceeding the expected 0.3%. Service prices rose 0.8%, with notable gains in equipment wholesaling. Goods prices dropped 0.3%, mainly due to gasoline. Yearly producer prices rose 2.9%, and core prices climbed 3.6%, both above forecasts.
Germany's inflation rate dropped to 1.9% in February 2026, below the 2.0% forecast, and the harmonized index fell to 2.0%, meeting the ECB's target. Goods inflation decreased to 0.8%, with sharper energy price declines and slower food inflation. Services inflation stayed at 3.2%, and core inflation remained at 2.5%
Macro calendar highlights (times in GMT)
0700 – Germany Jan. Retail Sales
1300 – US Secretary of War Hegseth press conference on Iran operations
1500 – US Feb. ISM Manufacturing
Earnings this week
Today: EchoStar, AST SpaceMobile, MongoDB
Tuesday: Crowdstrike, Ross Stores, Sea Limited, Thales, AutoZone
Wednesday: 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: Reports said the U.S. and Israel struck Iranian targets on Saturday, February 28, and Iran confirmed Supreme Leader Ali Khamenei was killed, a temporary leadership council was reported to have taken over as strikes and retaliation continued into Sunday. On the economic side, Tehran said it had closed navigation through the Strait of Hormuz and warned ships not to pass, which led several oil, gas, and shipping operators to pause transits, even if some vessel traffic still moved.
Europe: European equities were mixed as the STOXX Europe 600 edged up 0.1% to 633.85 while the Euro STOXX 50 slipped 0.4% to 6,138.41, and the UK’s FTSE 100 rose 0.6% to a record 10,910.55. Earnings helped, but banks lagged as investors focused on potential credit losses linked to the collapse of UK mortgage lender Market Financial Solutions. Barclays fell 4.2% and Santander dropped 2.8% on that theme, while Swiss Re gained 3.7% after strong profits and a new buyback plan and AstraZeneca rose 2.9% as defensives found buyers. Markets now looked to fresh inflation data and the next signals from the European Central Bank (ECB) and the Bank of England.
Asia: Asian markets finished mixed ahead of China’s National People’s Congress (NPC) on March 5, with Japan’s Nikkei 225 up 0.2% to 58,850.27 and Hong Kong’s Hang Seng up 0.9% to 26,657, while South Korea’s Kospi fell 1.0% to 6,244.13. Mainland China was split, with the Shanghai Composite up 0.4% to 4,162.88 but the CSI 300 down 0.3% to 4,710.65 as investors rotated between policy hopes and profit-taking. In Hong Kong, Sun Hung Kai Properties jumped 7.1% as property sentiment improved after Shanghai eased homebuying rules, and AIA rose 2.5% in the broader rebound. The next test was whether the NPC delivers concrete support, especially if higher oil prices and geopolitics keep risk appetite shaky.
Volatility
Geopolitics has returned to the centre of the risk map after the weekend escalation involving the U.S., Israel and Iran. Markets are now assessing potential spillovers via energy prices, shipping routes and inflation expectations. Oil prices jumped sharply at the open, while equity futures traded lower, reinforcing a cautious start to the week. This is the type of headline-driven environment where volatility tends to remain sensitive to every new development.
- At the close on Friday, the VIX stood at 19.86, with short-term measures such as VIX1D (19.05) and VIX9D (18.59) confirming that near-term uncertainty was already elevated before the weekend news. The SKEW index at 146.67 suggests investors are still paying up for downside protection, while VVIX at 110.89 indicates that volatility itself remains unstable rather than fully settling down.
- Expected move (SPX, options-implied): ±120 points, or roughly ±1.75%, into 6 March based on current weekly options pricing.
0DTE skew check (today’s expiry): implied volatility on near-the-money puts is higher than on comparable calls (approximately 28.65% vs 25.05% around the 6,880 strike), signalling continued demand for short-term downside hedges rather than aggressive upside speculation.
Digital Assets
Crypto markets are behaving like risk assets rather than safe havens. Bitcoin is trading around $65,900, down on the day, while Ethereum is near $1,930. Solana (~$82.9) and XRP (~$1.35) are also softer, reflecting a broad reduction in risk appetite as geopolitical tensions rise. The pattern fits with recent months, where digital assets have tended to correlate positively with equities during risk-off episodes.
In the ETF space, IBIT closed at $37.19 and ETHA at $14.52, both under pressure. Crypto-linked equities are mirroring that weakness, with Coinbase at $175.85 and MicroStrategy at $129.50 at the latest close. Friday’s options flow showed sizeable downside positioning in some crypto-related single names, while ETF flows appeared more balanced, suggesting selective risk reduction rather than outright capitulation.
If tensions escalate further and energy prices remain elevated, digital assets could remain sensitive to broader equity volatility. A rapid de-escalation, on the other hand, could see a stabilisation in both ETFs and underlying tokens.
Fixed Income
- US treasuries rallied heavily ahead of the weekend, suggesting safe haven seeking. The benchmark 10-year treasury yield closed Friday down more than six basis points at 3.94% and posted the first weekly close below 4.00% since mid-2024. Yields only edged very slightly lower in Asian hours Monday before rebounding slightly and back above Friday’s close. The benchmark 2-year treasury yield touched a new low since 2022 just below 3.36% before edging back above the Friday close, trading 3.385%.
US High yield debt spreads versus US treasuries widened sharply as risk sentiment was on the defensive Friday. The Bloomberg measure we track of high yield spread to US treasury yields widening nine basis points Friday to 291 basis points, a new high for the year and since late November.
Japanese government bonds rallied on safe haven seeking. The benchmark 2-year JGB yield edged lower and the benchmark 10-year JGB yield dropped more than five basis points and close to the lows of the 2026 Monday, trading below 2.08%. Japan is entirely dependent on imported oil, and almost all of it is imported from GCC countries in the Middle East.
Commodities
Gold and silver prices jumped aggressively Monday to absorb the impact of the US-Israeli attacks on Iran. This came on top of strong gains Friday, with gold up in late Asian hours by about USD 100 per ounce and trading near USD 5,375 per ounce, less than a percent from it’s record daily close in late January (5,417), although the intraday all-time high is 5,595 per ounce. Silver gained less aggressively, trading more than USD 1.2 higher at nearly USD 95 per ounce and well off its spike highs during illiquid early hours in Asian on Monday, when it nearly hit USD 100 per ounce.
Crude oil futures gapped massively higher to reflect the concerns about shipping through the Strait of Hormuz in the wake of the US-Israeli attacks on Iran. May Brent trade nearly USD 6 per barrel higher early Monday at USD 78.7 per barrel after spiking as high as USD 82.37 earlier in the session. April WTI crude oil was about USD 5 per barrel, trading just above 72 per barrel. While Iranian authorities declared that the Strait of Hormuz remained open Sunday, shippers are almost entirely avoiding activity in the strait out of caution and on prohibitive insurance costs. Approximately 25% of global crude oil exports travel by ship through the strait.
Currencies
The US dollar rose sharply on a global dive in risk sentiment in the wake of US-Israeli attacks on Iran. EURUSD traded Monday below 1.1740, down more than 0.6% from Friday’s close and at its lowest level since late January. USDJPY spiked above 157.00 Monday before easing back slightly. It closed Friday just above 156.00.
Sterling traded on the defensive on global risk off and on the political uncertainty triggered last week by a very weak Labour showing in a by-election Thursday, with EURGBP rising above 0.8750 and as high as 0.8790 Friday before ending the day and week near 0.8770, where it also trades Monday after a choppy session in Asia. With the stronger USD on the situation in Iran, GBPUSD has been pushed sharply lower to below 1.3380, down from the Friday closed above 1.3480 and close to the lowest levels of 2026 (an intraday low back in January at 1.3331).
The Norwegian krone rose sharply on the jump in oil prices, with EURNOK trading down 0.50% and at a new low since 2023 near 11.18.
