Sonja Marten, DZ Bank’s chief economist, says markets are "not sure which trades to play" as investors flee to safe havens. This confusion stems from persistent geopolitical concerns originating outside the United States, leaving traders without a clear directional playbook.

This uncertainty typically signals a risk-off sentiment, where capital flows into assets like gold or the U.S. dollar. For investors, it means reduced conviction in growth-oriented assets and a potential pause in equity rallies until the geopolitical fog lifts.

The immediate watch is whether central bank policy or diplomatic breakthroughs provide clarity. Until then, portfolio managers will likely favor defensive positioning, keeping volatility elevated across global financial markets as they await a more stable macroeconomic backdrop.