Market navigator:
week of 16 March 2026

What happened last week

• Iran crisis deepens oil shock: Oil flows through the Strait of Hormuz collapsed to a trickle from approximately 20 million barrels per day, constituting the largest supply shock in oil market history. Brent crude oil closed above $100 per barrel and the dollar index (DXY) regained the 100 level as Iran's new supreme leader vowed to keep the strait closed; the International Energy Agency's (IEA) record release of 400 million strategic reserve barrels failed to stabilise prices.
• China deflation fears recede: Annual inflation rose to 1.3% in February from 0.2% in January — the highest since January 2023. Core inflation increased 1.8% year-on-year (YoY). The National People's Congress reaffirmed a 2% inflation target for 2026 and set more specific measures to address involution.
• Bitcoin outperforms amid conflict: Bitcoin gained approximately 9% from the outbreak of hostilities, while gold and the S&P 500 fell 5% and 4% respectively. Optimism around the Clarity Act passing underpinned sentiment. Structural integration of digital assets into mainstream finance also accelerated — Intercontinental Exchange acquired a stake in OKX at a $25 billion valuation, and Kraken became the first digital-asset firm to receive a master account at the Federal Reserve (Fed).
• US data clouds outlook: The Q4 gross domestic product (GDP) estimate was revised to 0.7% annualised from 1.4%, and January's durable goods orders disappointed. Consumer price index (CPI) and personal consumption expenditures (PCE) data indicated stable but above-target inflation, leaving the economy on fragile footing ahead of conflict-driven commodity price pass-through.

Markets in focus

Fear grips Wall Street after third consecutive losing week

US equities extended their retreat last week, with the S&P 500 shedding 1.6% to record its first three-week losing streak in approximately a year. The correction remains relatively contained, with the index closing just 5% below its recent high. Sectors performance was mixed: Financials was the worst-performing sector, declining 3.4%, while Energy outperformed, gaining 2.1%. The Nasdaq 100 fell 1.1% for the week, while the Dow Jones declined 2.0%.

The Iran conflict compounded vulnerabilities that were already present. US equities had entered the crisis at elevated valuations, while concerns over artificial intelligence (AI) disruption to traditional business models had been weighing on technology stocks since late 2025. Liquidity pressures in the $2 trillion private credit market amplified risk-off sentiment, with Morgan Stanley limiting redemptions following similar action by BlackRock on their private credit funds.

Sentiment indicators have reached extreme territory following three weeks of selling. The CNN Fear and Greed Index has fallen to 20 — signalling extreme fear — while the CBOE total put/call ratio's 10-day moving average (MA) has risen to 0.95, a level last seen in April 2025. Historically, such readings have preceded market recoveries, suggesting a potential contrarian inflection point, though the persistence of the Iran conflict and its inflationary implications mean the path to recovery may prove less straightforward than past episodes.

From a technical perspective, the US Tech 100 fell through its 200-day MA last week, indicating that the medium-term trend has reversed to bearish. The next key level to watch is whether support near 24,200 holds; a sustained breach would confirm a descending triangle pattern, pointing to further selling pressure towards 23,000. Any rebound is likely to face resistance near 24,800.

Figure 1: US Tech 100 index daily price chart

Hang Seng outperforms Asia peers amid AI optimism

Chinese equities demonstrated relative resilience against broader Asian equity weakness last week. The CSI 300 index gained 0.2%, while the Hang Seng Index (HSI) lost 1.1%. The MSCI Asia Pacific Index declined 2.5%.

China's exposure to the Strait of Hormuz crisis is more contained than many peers, with oil shipments through the strait accounting for only around 6--7% of overall energy consumption. The recently concluded National People's Congress reinforced confidence in the domestic growth outlook, reaffirming a 4.5%--5% GDP growth target for 2026 and placing technology development at the centre of the economic agenda.

AI enthusiasm provided an additional boost. OpenClaw, an agentic AI tool, triggered a wave of investor interest in Chinese technology names. Chinese authorities subsequently moved to restrict state-run enterprises and government agencies from deploying OpenClaw on office devices, citing data security concerns. The restrictions tempered the initial euphoria and weighed on AI-linked equities.

Mainland buying remained robust. Southbound Stock Connect net inflows reached a record HK$37.2 billion on 9 March, with Tencent, CNOOC and Meituan attracting the strongest interest — reflecting investor confidence in domestically oriented businesses at a time of external uncertainty.

The daily chart shows the HSI's repeated attempts to maintain its medium-term bullish trend by reverting above the 200-day MA after testing support near 25,000 twice. A successful recovery may see the index advance towards resistance near 26,150-26,200. Failure to hold above immediate support near 25,000 may open a deeper pullback towards 23,200.

Figure 2: Hang Seng Index daily price chart

Strategic reserves fail to arrest oil price surge

Crude oil markets experienced extreme volatility last week, with both Brent crude oil and WTI crude oil briefly approaching $120 per barrel before retreating as governments moved to contain the energy shock. The IEA coordinated a record release of 400 million barrels of strategic reserves — surpassing the 183 million barrels committed following the outbreak of the Russia-Ukraine war in 2022. The US is contributing 172 million barrels, Japan 80 million and South Korea 22.5 million. The Trump administration also temporarily waived sanctions on Russian oil for 30 days to unlock additional supply.

These measures have done little to stabilise prices. The 400-million-barrel release represents only approximately 25 days of the 16 million barrels of daily flow at risk from Strait closure; physical pipeline constraints limit the drawdown rate, with the largest ever IEA release achieving only 2.5 million barrels per day. The US Energy Department estimates full delivery of its commitment will take approximately 120 days. Military escort of tankers through the strait remains an option which the US is not yet prepared to execute.

Futures markets suggest investors retain a degree of optimism regarding the conflict's duration — Brent's May contract trades around $101 per barrel against $93 for July, implying limited risk premium for a prolonged disruption. Yet the structural inadequacy of the reserve response suggests current prices may materially understate tail risk, and Iran's warning that oil could reach $200 per barrel may prove less fanciful than many assume should the strait remain closed for an extended period.

Technically, US crude oil prices are now trading above the 200-week moving average, indicating a medium-term bullish trend. Prices are in overbought territory, with the relative strength index (RSI) above 70, suggesting any de-escalation news could trigger a sharp pullback. Resistance is seen near $121.4, proximate to the March 2022 peak following the outbreak of the Russia-Ukraine war, while the September 2023 high around $94.2 may provide minor support, followed by $80 — an important psychological level and the 2025 annual high.

Figure 3: US crude oil weekly price chart

The week ahead

This week delivers an unprecedented confluence of central bank decisions, with the Fed, European Central Bank (ECB), Reserve Bank of Australia (RBA), Bank of England (BoE), Bank of Japan (BoJ), Bank of Canada (BoC) and Swiss National Bank (SNB) all convening against a backdrop transformed by the Iran conflict. Surging commodity prices have revived inflation fears globally, with the International Monetary Fund (IMF) estimating that every 10% sustained oil price increase reduces global output by 0.1--0.2% and adds 0.4 percentage points to inflation — complicating the easing paths most central banks had signalled entering 2026.

The Fed is widely expected to hold at 3.50%-3.75%, but the more significant development is the repricing of future cuts: the two reductions previously anticipated for June and beyond have been pushed out materially, with markets now pricing a meaningful probability of no further easing in 2026.

The RBA faces the sharpest policy reversal. With Australian headline inflation already running at 3.8% year-on-year ahead of the conflict, bonds futures now price an 80% probability of a 25-basis point hike to 4.10% on Tuesday, up from around 20% three weeks ago. The BoE faces an equally difficult choice: markets had anticipated a cut ahead of the conflict, but easing now risks entrenching inflation as energy prices rise. A hold would instead risk amplifying an already fragile growth outlook. Thursday's UK unemployment data will inform that judgement. The ECB is expected to hold at 2%, while the BoJ will be scrutinised for hiking signals in the second quarter amid yen weakness.

In China, Monday's data will gauge the health of the domestic economy across the property sector, retail sales and industrial production.

On the corporate front, Tencent and Alibaba report on Wednesday and Thursday respectively, with investors focused on AI monetisation progress and consumer spending trends.

Figure 4: Fed fund rate probabilities on future meeting dates

Key macro events this week

(In GMT+8 time zone)

Monday 16 March 2026

• 9.30am — China House Price Index YoY (February): previous -3.1%
• 10.00am — China Industrial Production YoY (January--February): previous 5.2%, consensus 5.1%
• 10.00am — China Retail Sales YoY (January--February): previous 0.9%, consensus 2.5%

Tuesday 17 March 2026

• 11.30am — Australia RBA Interest Rate Decision: previous 3.85%, consensus 4.1%

Wednesday 18 March 2026

• 7.50am — Japan Balance of Trade (February): previous -¥1,152.7 billion, consensus -¥485 billion
• 9.45am — Canada BoC Interest Rate Decision: previous 2.25%, consensus 2.25%
• 8.30pm  — US producer price index (PPI) MoM (February): previous 0.5%, consensus 0.3%

Thursday 19 March 2026

• 2.00am — US Fed Interest Rate Decision: previous 3.50%--3.75%, consensus 3.50%--3.75%
• 8.30am — Australia Unemployment Rate: previous 4.1%, consensus 4.2%
• 11.00am — Japan BoJ Interest Rate Decision: previous 0.75%, consensus 0.75%
• 3.00pm — UK Unemployment Rate (January): previous 5.2%, consensus 5.2%
• 4.30pm — Switzerland SNB Interest Rate Decision: previous 0%, consensus 0%
• 8.00pm — UK BoE Interest Rate Decision: previous 3.75%, consensus 3.75%
• 9.15pm  — ECB Deposit Facility Rate Decision: previous 2%, consensus 2%

Friday 20 March 2026

• 9.15am — China Loan Prime Rate 1Y: previous 3%, consensus 3%

Key corporate earnings

(in local exchange time)

Wednesday 18 March 2026

• Micron
• Tencent

Thursday 19 March 2026

• Alibaba

_{Source: Trading Economics, Nasdaq, LSEG (as of 14 March 2026)}