The escalating conflict in the Middle East is forcing investors to prioritize safety, triggering a shift towards traditional havens like Treasuries, gold, and the Swiss franc. Macro traders anticipate heightened volatility when markets reopen Monday, particularly in energy markets and currencies. Saudi Arabia's Tadawul All Share Index opened nearly 5% lower on Sunday, reflecting regional market anxiety.

This 'haven first, ask questions later' approach, advocated by Natixis' John Briggs, is driven by the scale of Iranian attacks exceeding market expectations and fears of prolonged turmoil. The potential disruption to the Strait of Hormuz, handling a quarter of global seaborne oil, is a critical watchpoint for traders like Roundhill's Dave Mazza. Rich valuations across global equities and credit are also making risk reduction more palatable for investors.