Pre-market: Nasdaq futures down 1.98% as oil prices approach $110

As oil prices surge again, both the stock and bond markets declined on Thursday. U.S. President Trump broke market expectations that the Middle East conflict would end quickly and energy supplies would be alleviated.

As of press time, Dow futures fell 1.32%, S&P 500 futures dropped 1.49%, and Nasdaq futures declined 1.98%.

In a prime-time speech, Trump promised that stronger actions would be taken against Iran in the next two to three weeks, but did not propose any specific plans to reopen the Strait of Hormuz. Market sentiment thus quickly weakened.

Stock markets plummeted

European stocks declined. Bank and industrial stocks fell, with the pan-European Stoxx 600 index dropping 1.2%, nearly erasing the gains from the previous trading day. Germany’s DAX index fell 1.5%, led by energy-intensive manufacturing stocks. In Paris, luxury and industrial stocks declined, dragging the CAC 40 down 1.25%.

Italy’s FTSE MIB and Spain’s IBEX 35 indices fell 1.2% and 1.3%, respectively. In London, oil giants’ gains partially offset the declines, but the FTSE 100 still dropped 0.7%.

Following Trump’s speech, U.S. stock index futures declined. Dow Jones Industrial Average futures fell 1.3%, S&P 500 futures down 1.5%, and tech-heavy Nasdaq 100 futures dropped 2%. In pre-market trading, oil and gas stocks like Venture Global Inc. and ExxonMobil rebounded, while travel, mining, and semiconductor sectors declined.

Because Trump’s remarks did not specify when the Middle East conflict would end, Asian markets tumbled, with Japan’s Nikkei down 2.4% and South Korea’s Kospi plunging 4.7%. Both indices are highly concentrated in energy-intensive tech manufacturing companies.

Although Trump also said that U.S. military actions are nearing their end, his repeated tough rhetoric caused major European stocks and Wall Street futures to fall, after Asian markets had already retraced most of the previous day’s gains overnight.

Claudio Galimberti, Chief Economist at Rystad Energy, said: “The president’s vague statements keep multiple military options open. As long as the path to de-escalation isn’t clear enough, markets are likely to remain highly volatile.”

Oil prices approach $110

Driven by Trump’s speech, oil prices rose more than $5. Brent crude surged 7.4%, breaking above $108 per barrel. WTI futures for May delivery increased 6.1% to $106.19 per barrel. Natural gas prices also rose, with Europe’s benchmark—Dutch TTF near-month contract—up 4.8% to €49.87 per megawatt-hour. European diesel futures rose to $200 per barrel.

Russ Mould, Investment Director at AJ Bell, said: “Since the initial surge, oil prices have rarely fallen below $100 per barrel. Compared to recent volatility in global stock indices, this perhaps better reflects the current situation, as the world is forced to face a reality: about 20% of global supply is disrupted.”

Laurent Lamagnere, Deputy CEO of Alphavalue in Paris, said: “The current market is simply unmanageable. Our real concern is the second-round effects—not just the oil price itself, but also oil supply, such as airlines cutting routes, which could severely impact tourism.”

Will the Strait of Hormuz reopen?

Trump said on Wednesday that the U.S. does not need this critical oil passage and that it will naturally reopen after the conflict ends.

Felix-Antoine Vezina-Poirier, analyst at BCA Research, said: “Over the past 48 hours, there have been various statements between Tehran and Washington, some suggesting a cooling of the situation. Meanwhile, substantial military activity has continued unabated.”

He also said: “Our macro political strategists offer a simple advice for dealing with volatility headlines: stick to the facts. First, shipping through the Strait of Hormuz has already begun to recover over the past few days. Second, Iran is deliberately shifting its targets from Gulf Arab states to Israel.”

In recent days, markets had been optimistic that Trump was seeking a quick exit from the war. But his Wednesday speech provided no clear timetable or substantive breakthrough on how to end the conflict. The war has already disrupted financial markets and pushed some indices into technical correction territory.

Mathias Heim, Chief Investment Officer at Belle Capital, said: “The longer energy prices stay high, the more it erodes consumer spending. Without fiscal transfers to offset this, disposable income will shrink, weakening demand.”

Prashant Newnaha, Senior Rate Strategist at TD Securities, said: “The only truly important question is whether the Strait of Hormuz will reopen soon.” This narrow choke point transports about 20% of the world’s oil and liquefied natural gas. He added: “Trump’s speech did not indicate that this would happen as quickly as the market initially expected.”

Bond markets sell off

Government bond yields rose again as markets anticipate that rising inflation will force central banks to hike interest rates or at least keep them steady.

U.S. Treasury yields rose across the board, with the two-year yield up 5 basis points to 3.85%. The 10-year yield increased 5.9 basis points to 4.379%, and the 30-year yield rose 5.1 basis points to 4.952%. This was due to traders lowering the probability of the Fed cutting rates in 2026 from over 20% to about 10%.

Eurozone government bond yields also climbed. Germany’s 10-year bund yield rose 4.1 basis points to 3.027%; France’s OAT 10-year yield increased 6.3 basis points to 3.744%. France’s upcoming long-term bond auction of €105-10.5B may further intensify selling pressure on French bonds. The money markets are again fully pricing in two rate hikes by the Bank of England this year and nearly three by the European Central Bank, each by 25 basis points.

Dollar regains strength

As the preferred safe-haven asset during this turmoil, the dollar rose against most currencies. After falling nearly 1% over the past two days amid market optimism that the war might end soon, the dollar index has gained nearly 2% year-to-date. The euro declined 0.5% to $1.1526; the pound fell 0.8% to just below $1.32.

Jon Withaar, Head of Asset Management at Pictet, said: “Since now expecting two to three more weeks of military action, with no exclusion of ground troops, and emphasizing threats to infrastructure, markets are shifting back to defensive mode.”

Due to the Indian rupee hitting a record low, the Reserve Bank of India intervened Thursday to ban so-called “non-deliverable forwards” (NDFs). This pushed the rupee up 2%, though analysts question how long this rebound can last.

LSEG data shows Bitcoin down 2.2%, to $66,664. It previously hit a near-week high of $69,232 on Wednesday, then retraced gains.

Gold ended its four-day winning streak. Other precious metals also declined sharply, with silver down 7.3% to $70.54; platinum down 4.6% to $1,896.70. Rising inflation risks related to oil prices are clouding the outlook for rate cuts, overshadowing gold’s appeal as a safe haven. Nonetheless, gold is still expected to rise more than 5% this week, after a rebound earlier this week when Trump hinted that the U.S. might withdraw from Iran in two to three weeks.

Investors will next focus on U.S. February trade balance data and weekly jobless claims. European and U.S. stock markets will be closed on Good Friday. The U.S. bond market will trade until noon tomorrow, with attention also on March non-farm payrolls.

Standard Chartered predicts: Gold prices will rebound and break new records again.

Since the outbreak of the Middle East conflict, gold has sharply declined. This contradicts the traditional view of gold as a safe haven providing stability (or appreciation) during market turmoil, increased uncertainty, or geopolitical tensions.

But Suki Cooper, Head of Commodities Research at Standard Chartered, believes that in the early stages of a crisis, gold often becomes a passive liquidation tool, with historical suppression periods lasting 4-6 weeks. Despite the sharper decline this time, overextended positions have mostly been cleared, and its safe-haven status remains solid. She expects gold prices to challenge historical highs again.

She pointed out that many structural drivers of gold remain intact, including high debt levels in the U.S. and globally, currency devaluation, trade and geopolitical uncertainties. Gold is currently priced against multiple risks, making its short-term trend hard to predict. Existing liquidity pressures may suppress gold for a while, but she still expects prices to rebound in the coming months. The 200-day moving average support, never broken since October 2023, remains strong. The overall trend for gold remains upward.

Bank of America warns: Iran war is dropping a “stagflation bomb” on the global economy.

Bank of America analysts expect that, due to the impact of the Iran conflict, even if the war ends in a few weeks, the economy will face slowing growth, rising inflation, and oil prices around $100 per barrel for the rest of the year.

BofA economist Claudio Irigoyen and his team wrote in a Wednesday report: “So far, the ‘benefits’ of the war have been mild stagflation,” referring to the coexistence of high inflation and slowing economic growth.

Irigoyen added that if the conflict escalates and prolongs, “sharp increases in energy prices, combined with significant asset price adjustments, could push the global economy into recession.”

Economists still expect the Fed to cut rates by 50 basis points this year, but the timing has been pushed from summer to fall, with high risks that these cuts may not materialize.

War fuels “weekend fear” in U.S. stocks! The S&P 500 falls into a “Black Thursday” timed crash curse.

Entering the fifth week of the Middle East war, the global economy remains impacted. The U.S. stock market has developed a predictable pattern: strong gains early in the week, narrow fluctuations midweek, then sharp declines on Thursday and Friday.

This pattern is especially evident in the S&P 500. Since the Iran conflict began, the index has gained in the first three trading days of each week but has fallen a total of 9% on Thursdays and Fridays.

Experts say the logic behind this isn’t complicated. With two days (or three, if a holiday falls) over the weekend when trading is halted, many further shocks to the global economy related to the war could occur during this period—especially considering Trump’s tendency to launch major actions when markets are closed.

Therefore, many investors tend to reduce stock holdings before the weekend.

Focus stocks

Large tech stocks declined before the open, with Tesla and Nvidia down 2%, Meta, Amazon, and Google A down over 1%, Microsoft down 0.9%, and Apple down 0.7%.

Storage chip companies fell before the open, with SanDisk down over 5%, Micron Technology down over 4%.

Global chemical prices entered an uptrend, with Dow Chemical up over 3% pre-market.

TotalEnergies rose over 2% pre-market, after announcing a new energy joint venture with Masdar.

Satellite operator Globalstar surged nearly 12% pre-market, reportedly in talks to acquire Amazon.

Penguin Solutions rose 8.66% pre-market, with Q2 FY26 results exceeding expectations and raising full-year guidance.

Fujifilm Pharma gained over 3% pre-market after FDA approval for label expansions of Alyftrek and Trikafta.