Public Markets 3d Briefing
×Market Volatility Amid Middle East Escalation
Defense stocks surged bloomberg.com Monday as military attacks escalated across the Middle East, with operations underscoring that air and naval assets remain central to military strategy. The S&P 500 rebounded from early declines wsj.com to finish up less than 0.1% after a choppy session, as a rally in energy and tech stocks helped offset initial 1.2% losses. Benchmark crude moderated an early double-digit surge to a 6.7% climb, while Brent crude futures jumped as the conflict threatened to snarl shipping lanes. Treasuries sank bloomberg.com as oil prices surged, stoking inflation fears that pummeled bonds amid diminishing odds for a rate cut. The dollar rallied by the most in nearly five weeks after the US attack on Iran set off a rush into havens, with the currency surging to over a five-week high on U.S.-Iran escalation.
Energy Sector Gains
Oil producers pounced bloomberg.com on the price surge to lock in future revenue as the crude market soared by the most since June, opening a window that had been scarce before US and Israeli strikes. Energy shares surged bloomberg.com alongside oil futures, with the Breakwave Tanker Shipping ETF (ticker: soaring to become the world's best-performing ETF as rising oil-shipping costs amid the conflict drove the rally. Energy ETFs attracted record flows bloomberg.com as escalating conflict in Iran drove investors to position before the full onset of hostilities, with the State Street Energy Select Sector SPDR ETF (XLE) seeing significant inflows.
IPO and Corporate Developments
PayPay Corp. and SoftBank Group Corp. bloomberg.com are seeking to raise as much as $1.1 billion in the digital payments firm's US IPO, which would be the biggest-ever listing for a Japanese company on a US exchange. However, SoftBank's PayPay delayed bloomberg.com the start of formal marketing for its US initial public offering, according to sources familiar with the matter. Sunbelt Rentals Holdings Inc. bloomberg.com made its US stock-market debut Monday amid a rush by investors into asset-heavy, capital-intensive businesses. Meanwhile, IAC agreed to sell Care.com wsj.com as the media conglomerate continues streamlining to focus on core assets.
Private Markets and Credit
Blackstone's flagship private credit fund ft.com was hit with a wave of redemptions, with investors pulling net $1.7 billion out of the vehicle over the past month as industry strains intensify. Ares Management closed bloomberg.com an $850 million deal that allowed an asset bought in 2018 to be rolled into a new vehicle. Ares emerged as the primary buyer bloomberg.com for a private credit portfolio sold by Arcmont Asset Management in the market for secondhand stakes. Two Canadian real estate funds bloomberg.com halted redemptions as they eye going public, with Canadian investment firm Avenue Living Asset Management Ltd. suspending redemptions at two multibillion-dollar funds for months.
Macroeconomic Implications
Janet Yellen warned bloomberg.com that depending on how long the Iran conflict affects the oil market, there will be both a hit to US economic growth and an increase in inflationary pressures. JPMorgan CEO Jamie Dimon called inflation risk bloomberg.com the "skunk at the party" for the US economy, warning that inflation could become a major concern. Former Treasury Secretary Yellen said the Fed may need to remain "even more on hold" given Iran conflict risk. India's growth is at risk bloomberg.com from the Middle East crisis if the conflict endures and disrupts oil supplies from the region that meet a large share of demand in the world's third-largest oil consumer.
Safe Haven Assets
Gold wagers hit a 16-week high bloomberg.com as investors sought harbor in gold amid US and Israeli strikes on Iran. Municipal bonds offered investors shelter bloomberg.com as the Iran war escalated, with most safe-haven assets higher Monday as investors braced for worst-case scenarios. The dollar's best day since January bloomberg.com reflected a rush to haven assets as war spurred demand for safe havens. Short-term Japan bonds held allure bloomberg.com for a bank managing $17 billion as it tested the country's choppy bond market by investing in shorter-term notes to secure higher returns.
Technology and Innovation
Nvidia stock slipped investing.com on reports of US chip export caps to China, while Intuit partnered with Anthropic finance.yahoo.com, prompting questions about whether to buy, sell, or hold INTU stock. AI is blowing up finance.yahoo.com one of shadow banking's biggest bets, with technology disrupting traditional financial models. Tech giants see a cure for cancer in AI finance.yahoo.com, though Eli Lilly's CEO finds it "not particularly good" at solving biology or chemistry problems. Novo Nordisk will spend €432 million bloomberg.com upgrading an Irish factory to produce its hit Wegovy weight-loss pill for markets outside the US.
Global Trade and Supply Chains
Iran conflict disrupted oil supply yahoo.com to Asian countries dependent on Middle East crude, while Venezuela sharply increased oil exports bloomberg.com in February under US oversight, sending roughly twice as many barrels abroad compared with the previous month. UAE aluminum maker Emirates Global Aluminum bloomberg.com is considering using offshore stocks to counter ship-loading delays as a result of the war in Iran. OPEC+ agreed to resume oil production increases bloomberg.com at a slightly accelerated pace as the conflict threatened to bolster a crude rally. Colombia's government is planning reciprocal tariffs bloomberg.com of 50% on imports from Ecuador, intensifying an economically damaging spat between the ideological foes.
Market Outlook and Strategy
Goldman traders warned bloomberg.com that US equities may need to pull back further before they can mount a durable advance, citing fragile sentiment and choppy flows that left the S&P 500 vulnerable. Wall Street strategists are turning to traditional playbooks bloomberg.com that say stock-market dips triggered by sudden geopolitical flareups are almost always good buying opportunities. Ed Yardeni of Yardeni Research said bloomberg.com the war with Iran is over, but Iran just doesn't realize it yet, arguing this could lead to more stability in the Middle East. Former UN Ambassador John Bolton agreed bloomberg.com with the objectives of US-Israeli strikes on Iran but expressed concerns about regime change in Iran.