Global markets rebound as easing energy fears boost equities

Market Commentary

US equity markets rallied on Monday, with the S&P 500 rising around 1.10%, the Dow Jones gaining about 1%, and the Nasdaq advancing 1.20%, as investors reassessed the risk of a prolonged energy shock. The move marked the strongest session since the Iran conflict escalated, supported by easing oil prices and improving sentiment, which drove a rotation into credit-sensitive sectors. Technology and banking stocks posted gains, while semiconductor companies outperformed amid continued optimism around artificial intelligence adoption.

European markets also closed higher, snapping a three-day losing streak as investors reassessed the scale of the potential energy supply disruption from the Persian Gulf. The Eurozone’s STOXX 50 rose 0.40%, while the broader STOXX 600 added 0.50%, as oil prices edged lower following signs of selective leniency in Iranian energy exports, with LPG shipments successfully transiting the Strait of Hormuz en route to India. This helped ease concerns around a prolonged global supply shock and related inflationary pressures, while financial stocks led the advance alongside firmer bond markets, with Allianz and Deutsche Bank both gaining around 1.50%.

Asian markets delivered a mixed performance on Monday. Hong Kong’s Hang Seng Index rose 1.45%, snapping a three-day losing streak, supported by stronger-than-expected Chinese data for January–February, including industrial output, retail sales, and fixed-asset investment, which lifted major technology stocks. In contrast, mainland China’s Shanghai Composite slipped 0.26% for a third consecutive session, weighed by pressure in commodities, including a sharp drop in aluminium prices and continued oil volatility above $100 per barrel amid US-Iran tensions. Japan’s Nikkei declined roughly 1.20%, dragged lower by yen weakness, cautionary inflation signals from Bank of Japan Governor Kazuo Ueda, and underperformance in autos and technology stocks such as SoftBank.

South Africa’s FTSE/JSE All Share Index rose by 1.43%, extending its gains to a third consecutive session in line with firmer global markets. The advance was supported by improving sentiment as oil prices eased, helping to temper stagflation concerns linked to geopolitical tensions. Gains were broad-based across financials, industrials, telecoms, and retail stocks, offsetting weakness in the resource sector. Sasol stood out, surging nearly 8% on the back of energy-related relief. The Top 40 also edged higher despite remaining down 2.38% for the month.

The rand strengthened against a softer US dollar, with USD/ZAR easing to 16.67, supporting foreign inflows and mirroring the positive tone in global equities. However, elevated oil price volatility continued to cap risk appetite. Despite these headwinds, the index remains firmly higher year to date, up 31.67%, underscoring resilience amid a volatile geopolitical backdrop.

Oil and gold prices pulled back as markets took comfort from easing supply concerns linked to US–Iran tensions. Brent crude declined 2.89% to $102.14 per barrel, retreating from recent highs above $105 amid a combination of strategic reserve releases and signs of softer demand. Meanwhile, gold prices also weakened, with March futures falling 1.18% to around $5 001/oz (spot at $5 019), as a firmer US dollar and reduced expectations for near-term Fed rate cuts outweighed safe-haven demand.