Public Markets 3 Days

Last updated: April 2, 2026, 11:30 PM ET

Geopolitics & Commodities Shockwaves

Global markets reacted sharply to escalating Middle East tensions, with oil benchmarks surging past $100 and prompting various supply chain adjustments worldwide. Following President Trump’s remarks dashing hopes for a swift resolution, West Texas Intermediate settled at its highest level since mid-2022, while Iranian oil is now fetching a premium over Brent crude for the first time since May 2022, reflecting tighter sanctions-constrained supply. On the supply front, US naphtha exports are surging as Middle East flows are cut off, forcing Japanese buyers to source feedstock from Texas and Louisiana, and Canada’s Irving refinery is turning to Newfoundland crude for the first time in three years. The ripple effect continued into industrial metals, where copper fell after the US president reiterated threats to strike Iranian power plants, though some firms like Continental Resources plan output increases amid soaring prices.

The energy crisis is manifesting as rationing and altered trade routes across the globe. Governments from Bangladesh to Zambia are imposing measures to curb fuel demand as Mideast flows diminish, while Australia broadened its fuel tax cuts to shield consumers from price hikes. In fixed income, money managers, including T. Rowe Price Group, are buying cheapened MBS following the volatility caused by the Iran war. Meanwhile, Japanese power retailers are temporarily halting new industrial client intake due to uncertainty surrounding fuel markets, exacerbated by the termination of a key US LNG purchase agreement between Commonwealth LNG and Japan’s Jera Co..

US Political Turmoil & Regulatory Shifts

Political instability in Washington marked the period, dominated by high-level personnel changes and aggressive trade policy maneuvers. President Trump dismissed Attorney General Pam Bondi, replacing her with deputy Todd Blanche, with reports suggesting the core dissatisfaction stemmed from Bondi’s failure to serve the president’s need for revenge. Simultaneously, the administration unveiled tariffs up to 100% on branded drugs, forcing pharmaceutical companies to negotiate pricing deals or manufacturing commitments to secure lower levies, a move that follows the UK urging pharma investment after reaching a separate pricing accord. Further complicating the domestic picture, the US is seeing rising mortgage rates, with the 30-year average climbing to 6.46 percent, as the Iran war weighs on the housing market.

The geopolitical friction is also encouraging rivals to find new economic pressure points against the US, as seen by rival nations seeking leverage over choke points. Domestically, Congressional leadership showed vulnerability as the House speaker delayed a bill to reopen Homeland Security, reflecting deep party rifts; this shutdown struggle leaves tens of thousands of DHS workers unpaid while law enforcement officers continue to collect paychecks. Separately, the Supreme Court heard arguments in the closely watched birthright citizenship case, with justices signaling a likely ruling against the president’s plan, which follows previous judicial pushback against the administration’s tariff program.

Asia Market Movements & Corporate Earnings

Asian markets displayed mixed sentiment, with Japanese equities rebounding after the President signaled a three-week war exit timeline and better-than-expected Tankan survey results. However, underlying domestic economic data suggested underlying weakness; China’s private sector services gauge slowed in March following the boost from the New Year holiday, indicating sluggish consumer demand. In corporate news, Japanese firms announced fewer share buyback programs in the last fiscal year, the first decline since 2020, even as retail earnings season began with mixed outlooks from giants like Fast Retailing, owner of Uniqlo. Furthermore, Japanese government bond futures edged higher in early trading, tracking overnight price increases seen in the US Treasury market.

Private Credit Exodus & Asset Management

The private credit sector faced continued redemptions as institutional investors sought liquidity, with nearly $14 billion requested for withdrawal from funds in the first quarter alone. Firms like Blue Owl Capital saw ugly top-line fund numbers and faced a $5.4 billion redemption request wave, leading the industry to embrace classic Wall Street maneuvers like securitization through CLOs to raise necessary cash. Oaktree Capital Management’s chief observed this trend, citing excessive risk-taking in the asset class due to software sector weakness and poor underwriting vintages, a risk that Blackstone Inc. exemplified by refusing further credit lifelines to Thoma Bravo’s Medallia. In contrast, some investors are finding value in public markets, as money managers like T. Rowe Price are buying cheapened US mortgage bonds, while US investment-grade bond funds experienced their largest weekly outflows in about a year.

Tech Valuation Targets & Regulatory Fights

Valuations for high-growth private firms soared, with SpaceX targeting an IPO valuation above $2 trillion, positioning it for potentially the largest debut ever. Meanwhile, the artificial intelligence field saw both investment and scrutiny; OpenAI acquired a streaming show to foster constructive conversation around AI’s impact, even as Carson Block began hedging against an AI-driven meltdown by betting against credit ETFs like HYG and LQD. On the public side, retail investors are chasing pre-IPO stakes, with Cathie Wood’s Ark ETFs planning to add an OpenAI position. However, the broader tech sector faced existential concerns, with one opinion piece asserting AI is a threat to jobs, equality, democracy, and the human race, prompting calls for Congressional action.

European and UK Economic Headwinds

European markets are confronting elevated energy costs and slowing growth projections tied to the Middle East conflict. Germany’s power prices for May surged to four times the level seen in France, amplifying long-standing structural differences in energy supply. An ECB Governing Council member acknowledged that the rise in inflation expectations since the Iran war is unsurprising, leading the EU to propose carbon market concessions to temper energy bills without immediately releasing more emissions volumes. In the UK, FTSE 100 retailer M&S demanded urgent government action to combat shoplifting, while the government paused a plan to write off up to £500 million in unpaid household energy bills. UK borrowers refinancing five-year fixed-rate mortgages face a monthly payment shock averaging an extra £395.

M&A Activity and Retail Performance

The first quarter saw a wave of large transactions, with 22 megadeals valued above $10 billion announced. Estée Lauder Cos. and Spain’s Puig Brands SA are advancing talks to form a combined entity, while FTSE 100 giant Unilever is combining its food business with McCormick to create a $66 billion food giant. In retail, Nordstrom’s revenue returned to its pre-pandemic peak less than a year after being taken private in a $6.25 billion transaction. Conversely, toymaker Pop Mart International Group experienced a sharp downturn, with its shares suffering a $33 billion rout as skepticism grew around its Labubu-led growth strategy.