Market drivers and catalysts
Equities: Wall Street hit records, Europe slipped on earnings misses, and Asia stayed firm as peace hopes and chip demand lifted sentiment.
Volatility: Record highs, easing VIX, Iran diplomacy, oil risk, downside hedging
Digital Assets: Risk-on tone, BTC above 75k, IBIT/ETHA strength, altcoin participation, constructive flow
Fixed Income: Global bond yields steady
Currencies: USD weakness continues, AUDUSD hits multi-year high, JPY volatile on Ministry of Finance intervention talk.
Commodities: Oil steady; silver supported by another annual deficit
Macro events: US Weekly Jobless Claims, US March Industrial Production
Macro headlines
Washington and Tehran are weighing a ceasefire extension to allow more peace talks, while the US naval blockade keeps the Strait of Hormuz effectively closed and markets on edge. Iran has warned it could retaliate by suspending shipments in nearby waters, and a second round of talks is expected to focus on reopening the strait and Iran’s nuclear program.
US businesses pulled back on hiring and spending due to uncertainty from the Iran war, according to the Federal Reserve's beige book report.
President Trump threatened to fire Fed Chair Jerome Powell if he doesn't step down when his term expires on May 15. On Tuesday, Kevin M. Warsh will make his case to the Senate Banking Committee, which oversees the Fed and wields significant power over his ability to clinch a confirmation. That leaves the administration with only 24 days to get Mr. Warsh through an initial committee vote before the full Senate takes up his candidacy.
Australia March Employment Change was +17.9k overall vs. +20k expected and the Unemployment Rate was steady near 4.3%. Fully time employment growth was a robust +52.5k for the month, while Part time employment dropped -34.6k.
BoE Governor Andrew Bailey said the central bank is in no rush to raise interest rates despite the energy shock from the Iran conflict, noting markets got ahead of themselves with rate hike bets.
ECB officials are said to be leaning toward keeping interest rates unchanged in April, postponing their verdict on whether the Iran war fallout warrants a response.
Japan's Finance Minister Satsuki Katayama said authorities are prepared for bold action on foreign exchange if needed after discussions with US Treasury Secretary Scott Bessent.
US import prices rose 0.8% m/m in March 2026 after 0.9% in February, below the 2% forecast, with fuel up 2.9% and nonfuel imports up 0.6%. They were 2.1% higher y/y, the biggest rise since December 2024.
Macro calendar highlights (times in GMT)
0600 – UK Feb GDP, Trade Balance, Industrial Production
1130 – ECB Minutes from March Meeting
1230 – US Weekly Jobless Claims
1230 – US Apr. Philadelphia Fed Business Outlooi
1315 – US March Industrial Production
1430 – EIAs Weekly Natural Gas Storage Change
Earnings this week
Thursday: TSMC, Netflix, PepsiCo, Abbott Laboratories, Charles Schwab, Prologis, Bank of New York Mellon, US Bancorp, Marsh & McLennan, Travelers Companies, Infosys, Tesco
Friday: Truist Financial, Fifth Third Bancorp, Ericsson
For all macro, earnings, and dividend events check Saxo’s calendar.
Equities
USA: The S&P 500 rose 0.8% to 7,022.95 and the Nasdaq 100 gained 1.4% to 26,204.58, both record closes, while the Dow Jones Industrial Average slipped 0.2% to 48,463.72. The mood stayed risk-on as hopes for fresh US-Iran diplomacy eased oil fears and bank earnings added another layer of reassurance. Allbirds surged 582.3% after the struggling shoemaker said it would pivot to AI infrastructure, rebrand as NewBird AI, and raise $50 million to buy graphics processing units for cloud computing services. Tesla jumped 7.6% after Elon Musk said the AI5 chip design was complete, Robinhood rallied 10.4% after the Securities and Exchange Commission approved ending the old $25,000 day-trading rule for smaller accounts, Morgan Stanley gained 4.5% on strong investment banking and wealth results, and Bank of America rose 1.8% after a profit beat. Markets now watch Netflix, rates, and whether diplomacy keeps doing the heavy lifting.
Europe: The Stoxx Europe 600 fell 0.4% to 617.27, the FTSE 100 lost 0.5% to 10,559.58, while Germany’s DAX edged up 0.1% to 24,066.70. The region lagged Wall Street as luxury and chip-equipment stocks ran into a tougher earnings test, with oil still clouding the inflation outlook. Hermès dropped 8.2% after first-quarter sales missed expectations as Middle East demand and tourism weakened, Kering fell 9.3% as Gucci sales disappointed, and ASML lost 4.2% even after raising its 2026 outlook, which is a neat reminder that strong results and a happy market are not always the same thing. Oil, European Central Bank rate bets, and more earnings stay in focus.
Asia: Asian equities finished firmer in the latest full session, with South Korea’s Kospi rising 2.1% to 6,091.39, Japan’s Nikkei 225 adding 0.4% to 58,134.24, and Hong Kong’s Hang Seng edging up 0.3% to 25,947.32. Relief on geopolitics and steady artificial intelligence demand kept sentiment supported. TSMC rose 1.2% ahead of results, and CATL then reinforced the region’s growth story by beating first-quarter estimates with net income up 48.5% and revenue up 52.5%, helped by stronger energy storage demand and cost control. Asia now looks back to Taiwan, where TSMC has since reported a 58.0% jump in quarterly profit, keeping the chip cycle very much alive.
Volatility
Volatility continued to ease as the S&P 500 closed at a fresh record 7,022.95, decisively clearing the 7,000 level, while the VIX slipped to 18.17. The tone reflects improving sentiment around potential US-Iran diplomacy, a pullback in oil from recent highs, and a supportive start to earnings season. For investors, the key takeaway is that markets are stabilising, but not risk-free. Oil remains elevated near $95, and the Strait of Hormuz continues to be a critical chokepoint for global energy flows, meaning any negative headline could quickly reverse the current calm.
- Expected move for the S&P 500 this week: options pricing implies a move of around 55.9 points into the 17 April expiry, or roughly 0.8% from current levels.
- Today’s skew indicator: same-day SPX options still show a preference for protection, with near-the-money puts around 7,020–7,025 trading at higher implied volatility than comparable calls. Short-term volatility has eased (VIX1D 12.65, VIX9D 16.01), but the structure suggests investors remain cautious beneath the surface.
Digital Assets
Digital assets are firmer, following the broader improvement in global risk appetite. Bitcoin traded around $75,059, with Ethereum near $2,358, while listed vehicles IBIT and ETHA also moved higher to roughly $42.56 and $17.97. This broad-based strength matters because it shows the recovery is not limited to crypto-native markets, but is also visible through regulated ETF products used by mainstream investors.
Across the wider market, XRP held near $1.41 and Solana around $85.5, pointing to a modest but broad participation beyond bitcoin. Crypto-related equities also strengthened, reinforcing the constructive tone. Options flow supports this view: investors added upside exposure in COIN and MSTR, alongside call activity in IBIT and ETHA, while selective downside hedging remained in place. The overall picture is constructive, but still disciplined rather than euphoric.
Fixed Income
US treasuries were steady in the lower portion of recent trading ranges Wednesday and early Thursday, with the benchmark 2-year US treasury yield near 3.75% and the benchmark 10-year treasury yield near 4.27%.
Japan’s government bonds were steady after Japan’s Minister of Finance indicated central banks are cautious about hiking rates amidst the Middle East crisis. The benchmark 2-year JGB yield nudged slightly lower to 1.37%, while the benchmark 10-year JGB yield fell a basis point to 2.41%.
Commodities
Oil has steadied, with Brent holding near USD 95 on signs the US and Iran may extend a ceasefire and restart talks aimed at ending a war that has choked global supplies of key commodities from the Persian Gulf. This has triggered a major supply shock, the impact of which continues to build globally, with the relative calm and sub-USD 100 futures prices not fully reflecting the reality in the physical market.
Silver rose back above USD 80 for the first time in a month after the Silver Institute, in its annual outlook, said the market is expected to remain in deficit for a sixth consecutive year. The shortfall is being driven by robust demand for bars and coins alongside declining supply, with the 2026 deficit projected to widen by 15% to 46.3 million troy ounces.
Gold bounced back above USD 4,800, supported by silver’s tailwind and lower oil prices amid hopes that US-Iran diplomacy may ease inflation risks. In addition, a softer dollar has underpinned the recent recovery, with a sustained break above USD 4,850 likely needed to attract fresh momentum and technical buying.
Currencies
The US dollar remained weak, though the pace of declines slowed, EURUSD tested as high as 1.1824 early Thursday after closing Wednesday near 1.1800. Elsewhere, AUDUSD pulled to new highs since 2022, stretching above the March high of 0.7187 and nearly pressing to 0.7200.
The JPY was volatile Thursday in Asian trading hours as Japan’s Finance Minister Katayama warned of bold action to support the JPY after saying that she had discussed currencies with US Treasury Secretary Scott Bessent. She also indicated central banker reluctance to consider rate hikes in the context of the uncertainty caused by the war in Iran and higher energy prices, suggesting to some that the Bank of Japan is unlikely to hike rates later this month (the odds of a April 28 rate hike hit fresh lows of 5% on Thursday). USDJPY traded as low as 158.27 after closing Wednesday at 159.00, but rallied back to 118.85 as of early Thursday hours in Europe.
