Markets rise as easing tensions lift sentiment

Market Commentary

Global markets traded firmer on Tuesday, as easing geopolitical rhetoric and ongoing energy market developments continued to shape investor sentiment. 

US equities closed sharply higher, with the S&P 500 gaining 3%, the Nasdaq Composite surging 3.50%, and the Dow Jones Industrial Average rising 2.60%—marking its strongest session since May. The move followed reports that Iranian President Masoud Pezeshkian is open to ending regional hostilities under specific guarantees, alongside de-escalation efforts from President Donald Trump despite the continued closure of the Strait of Hormuz. Technology stocks led the advance, with Nvidia climbing 5.60% and Microsoft up 3.10%. For the month, the S&P 500 ended down 5.30%, marking its weakest monthly performance since 2022. US inventory data showed crude stockpiles rose by 10.263 million barrels in the week ended 27 March 2026, compared to expectations of a 1.3-million-barrel decline. Gasoline inventories fell by 3.209 million barrels, while distillate stocks decreased by 1.04 million barrels. 

European equities edged higher for a second consecutive session, with the STOXX 50 rising 0.30% and the STOXX 600 gaining 0.40%. Inflation data for March came in slightly below expectations, although it confirmed a strong impact from the Middle East conflict on prices. European Central Bank President Christine Lagarde and Chief Economist Philip Lane indicated that developments may warrant a hawkish response, depending on the scale of the energy shock. Banking stocks advanced alongside lower bond yields, while selected technology-linked shares also gained. The STOXX 50 nevertheless declined 9.50% over March. 

In the UK, the 10-year gilt yield fell below 4.85%, retreating from multi-year highs as markets reassessed growth risks linked to higher energy prices. Despite the pullback, yields remained on track to rise by around 60 basis points for the month. Bank of England policymaker Alan Taylor maintained a cautious stance, signalling a high threshold for rate increases. 

Asian data reflected a mixed picture. China’s Manufacturing PMI eased to 50.8 in March from 52.1, indicating slower expansion, while input and output price pressures accelerated amid rising energy costs. In Japan, the BoJ’s sentiment index for large manufacturers rose to 17 points in the first quarter, its highest level since late 2021, although planned capital expenditure growth slowed notably. 

Locally, the sixth South Africa Investment Conference commenced in Sandton, Johannesburg, with the government targeting R2 trillion in investment by 2028. The event follows a two-year hiatus and comes amid uncertainty linked to the Middle East conflict, which may affect delegate attendance. Trade, Industry and Competition Minister Parks Tau noted that the previous five-year investment drive secured R1.5 trillion in pledges between 2018 and 2023, exceeding the initial target. The rand strengthened towards R17 against the US dollar, recovering from recent lows, supported by firmer precious metal prices. Finance Minister Enoch Godongwana also announced a temporary reduction in the fuel levy to mitigate rising domestic fuel costs. 

In commodities, gold traded above $4 570 per ounce but remained on track for its steepest monthly decline in over 17 years, down more than 13% in March. Silver rose to around $73 per ounce, though it remained set for its largest monthly drop in over 14 years. Both metals continued to reflect shifting monetary policy expectations and the impact of elevated energy prices. Brent crude settled at $118, while WTI crude eased to around $101 per barrel after earlier gains, as shifting geopolitical signals influenced supply expectations. Oil price movements remained central to broader market volatility, with global prices on track for a gain of around 40% in March.