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Last updated: March 31, 2026, 8:30 PM ET

Geopolitical Shift Sparks Market Euphoria & Energy Volatility

Global markets experienced a euphoric rally as reports surfaced that both the U.S. and Iran were signaling an openness to ending the ongoing conflict, sending Asian stocks poised to track the Wall Street surge. President Trump explicitly stated he was prepared to withdraw from the conflict within "two to three weeks," regardless of a negotiated deal, causing immediate relief across risk assets. This optimism drove a sharp turnaround in energy markets, where oil prices declined on signs of resolution, though key U.S. oil grades were still commanding the highest premium since Covid-19 due to lingering supply chain chaos. Furthermore, gold, which had been gaining on de-escalation signs potentially leading to lower oil prices following the President’s remarks.

The swift shift in geopolitical sentiment immediately impacted European and North American trade flows and corporate planning. European equities saw a significant boost, with Canadian stocks notching their most exuberant trading session in nearly a year based purely on the war resolution hopes. However, the conflict’s lingering effects were still visible in supply chains, as New York began rerouting jet fuel shipments to England to manage aviation fuel disruption, while Unilever Plc announced it would freeze global hiring for three months citing higher shipping costs stemming from the war. Even with the hopeful news, the damage is measurable: Australian manufacturing slipped into contraction in March due to weakened demand and surging costs related to the conflict, and Euro-zone inflation jumped most steeply since 2022, driven by energy costs.

Corporate Dealmaking and Tech Sector Heat

The technology sector saw massive capital inflows, particularly into artificial intelligence infrastructure, as OpenAI closed its largest funding round ever at a staggering $122 billion valuation, attracting investment from Amazon, Nvidia, and SoftBank. The Chat GPT maker further tapped retail demand, with OpenAI raising $3 billion from individuals as part of the overall haul. This AI momentum propelled other tech valuations; Oracle’s stock climbed 5% as investors viewed the database firm as a barometer for AI prospects, even as the company announced layoffs amid heavy AI investment, a strategy also employed by Block Inc. leader Jack Dorsey who pitched AI replacements for middle managers. Meanwhile, in the pre-IPO space, investment banks are set to convene Monday to prepare for the highly anticipated SpaceX initial public offering, though overall US IPO prospects remain clouded by war-related volatility denting optimism.

In broader corporate finance, private credit continued to attract large commitments, evidenced by Blue Owl Capital closing its latest fund at $2.9 billion, exceeding its $2.5 billion target. Despite this appetite, risks persist, with Germany’s DZ Bank warning that the oversized private credit market poses a chain reaction risk to the U.S. economy, while KPMG in Canada faces allegations from regulators for failing to properly value loans at a collapsed private lender. Healthcare dealmaking remains active, with Eli Lilly agreeing to acquire Centessa for $6.3 billion to bolster its immunology portfolio, and Biogen planning to buy Apellis Pharmaceuticals for $5.6 billion. Conversely, struggling consumer brands are seeing rapid asset liquidation; Allbirds, once valued at $4 billion, finally sold its intellectual property for just $39 million to American Exchange Group, which owns brands like Ed Hardy.

Fixed Income and Regulatory Scrutiny

The prospect of the Iran war ending has eased immediate inflation fears, causing U.S. bond traders to abandon bets on rising inflation to focus instead on potential growth headwinds from elevated oil prices. This sentiment initially led to a rise in Treasurys as oil retreated from multiyear highs, though 10-year Treasuries are still poised for their biggest monthly tumble since President Trump returned to office. In the corporate credit space, Goldman Sachs informed clients that its new tool for shorting the $1.4 trillion leveraged loan market is not yet ready for deployment. Regulatory attention remains focused on the stability of financial plumbing; Federal Reserve Governor Michael Barr flagged stability risks associated with stablecoins, specifically concerning potential money laundering.

In Washington, political maneuvering continues amidst the Department of Homeland Security funding lapse, where approximately 120,000 law enforcement officers continue to collect paychecks, while tens of thousands of other workers remain unpaid. Separately, the Justice Department is grappling with a complicated internal debate over how to formulate a response to President Trump’s lawsuit demanding $10 billion from the IRS 6. In judicial news, the Supreme Court rejected a ban on "conversion therapy" for minors, while a judge concurrently halted construction on the White House ballroom.