Hello traders, welcome to a new week, the last full trading week of March. Many market participants were waiting for the open to see whether the weekend would bring another major shock and large opening gaps. That did not happen. The Asian session has been volatile, but the weekend gaps themselves were not especially large.
The market remains focused on the conflict involving Israel, the US, and Iran, with particular attention on the Strait of Hormuz and the risk of a blockade. That is the key source of uncertainty for the energy market. Even so, oil did not open with a major surge after the weekend. On WTI, for example, price is still trading more or less where it finished last week, slightly below the 100-dollar mark. So despite the geopolitical tension, crude is currently holding sideways rather than accelerating higher.
Elsewhere in commodities, the weakness is much more visible in metals. Gold is down almost 4% and silver is lower by around 5%, so the new week begins with a clear bearish tone across precious metals. This is a significant move and shows that pressure in the commodity space is not limited to energy.
Equity indices are also under pressure. After a very weak Friday, markets are opening Monday with a bearish gap and extending losses into the European open. The major indices are clearly in the red, which confirms that sentiment remains defensive.
In the FX market, European currencies are weaker, and the Australian dollar is also under notable pressure. On the stronger side, we see gains in the North American currencies, with both the US dollar and Canadian dollar moving higher.
The macro calendar is quiet today, which is typical for a Monday. There are no major data releases scheduled. More relevant macro events arrive tomorrow, when PMIs from the main global economies will be published.
For now, though, the market is not trading macro. The focus remains on the ongoing bearish sentiment across risk assets and on developments related to Iran.