Markets endured another week of volatile trading as investors tried to make sense of the trajectory of the US-Israeli military campaign against Iran. US President Donald Trump’s suggestion that the campaign would wrap up in two to three weeks boosted optimism early in the week – which gave way to anxiety following his address to the nation last night.
Markets rallied on Tuesday and Wednesday on hopes that the campaign was nearing its end. The S&P 500 surged nearly 3% on Tuesday, its best single day since May 2025, after Trump signalled the US had achieved its core military objectives. Oil prices also fell sharply as traders priced in an end to the war.
That strong end to the quarter and the month was not enough to reverse the losses markets have racked up since the beginning of the conflict. The S&P 500 fell 5% and the MSCI World fell 6.4% during March. For the year to date, the S&P 500 was down 4.4%, and MSCI World has shed 3.6% to the end of March, marking the worst first quarter for US equities since 2022.
In his much-anticipated national address, Trump did little to reassure markets that he was ready to conclude hostilities. While he reiterated that American objectives were nearly met, he also vowed to hit Iran “extremely hard” over the coming week.
For its part, Iran denied claims that its leaders were seeking a ceasefire and reiterated that the Strait of Hormuz remains firmly under Iranian control. Markets reacted nearly immediately and negatively. Soon after the speech, Brent Crude climbed from just under $100 to above $106.
Asian indices fell as markets began trading this morning. Hong Kong’s Hang Seng index fell 1%, South Korea’s Kospi dropped over 4%, and Japan’s Nikkei shed 2.3%. US futures at the time of writing indicate that the S&P 500 is likely to fall 1.2% today.
Nonetheless, there are signs that the war may be over sooner rather than later. Iranian President Masoud Pezeshkian took the unusual step of writing an open letter directly to the American people, urging them to look past what he called a “flood of distortions” from Washington – a move that hints both sides may be looking for an offramp.
But for now, a pattern has taken hold. Markets gained strongly early in the week on ceasefire hopes but look set to retreat today as investors shed risk ahead of the weekend, when anything can happen, and no one can trade. That cycle looks set to continue until the mixed messaging from Washington is replaced with the contours of a sustainable ceasefire.
“Our President will start a war with Iran because he has absolutely no ability to negotiate. He’s weak and he’s ineffective. So, the only way he figures that he’s going to get re-elected, and as sure as you’re sitting there, is to start a war with Iran.’’
– Donald Trump – referring to then-President Barack Obama in 2011
“I can say tonight that we are on track to complete all of America’s military objectives very shortly. We are going to hit them extremely hard over the next two to three weeks.”
– US President, Donald Trump
Global News
- US markets ended sharply higher on Tuesday and extended gains on Wednesday before Trump’s late-night address, supported by growing optimism that tensions in the Middle East could ease, particularly on hopes that the Strait of Hormuz could reopen, which lifted investor sentiment and risk appetite. The S&P 500 and Nasdaq both advanced as investors rotated back into equities after recent volatility, while falling oil prices eased inflation concerns and reduced pressure on central bank policy expectations. Treasury yields were mixed, and the dollar softened slightly, reflecting a partial unwind of safe-haven positioning.
- Trump said late on Wednesday night that the Iran war is “very close” to ending, even as he warned the US could escalate strikes in the coming weeks if no deal is reached. He said core military objectives had largely been achieved, including destroying Iranian ballistic missiles and drones, air force, navy and industrial base. Yet he signalled further attacks on “each and every one of their electric generating plants” if no deal was reached. Trump failed to give a clear indication as to timing and glossed over issues such as the status of Iran’s enriched uranium and passage through the Strait of Hormuz. Ahead of Trump’s address, Iranian President Masoud Pezeshkian released a rare letter to Americans, saying Iran has no enmity with the US.
- Major stock market bourses are still only 5% below their highs reached at the beginning of the war. However, the headlines continue to speak of escalation and an imminent economic disaster as a result of the conflict. John Authers from Bloomberg explains this in that “geopolitical shocks matter primarily through the effect they have on the supply and price of oil. A short interruption can be tolerated, whereas a sustained surge to higher levels cannot. Crude oil is in the deepest contango (meaning that futures are trading at levels that imply prices will come down in the future) on record.”
- The US dollar posted its strongest monthly gain since 2022 in March, with the Bloomberg Dollar Spot Index rising about 2.4% as the Middle East conflict drove investors toward safe-haven assets and pushed oil prices higher. The rally was further supported by weaker global growth expectations and fading prospects of US rate cuts, which boosted demand for the currency and prompted traders to unwind bearish positions. However, moves remained sensitive to shifting war developments, underscoring continued volatility in currency markets.
- Gold rose 2.9% this week to about $4,621 an ounce at the time of writing, but had its steepest monthly decline since October 2008, falling 11% in March amid concerns about the Iran war fuelling inflation and expectations of higher interest rates. Higher oil prices and a stronger dollar have weighed on bullion by increasing the opportunity cost of holding non-yielding assets, even as longer-term demand remains supported.
- Millions of demonstrators rallied across the US last Saturday in a third round of “No Kings” protests against Trump. Protesters are voicing outrage over Trump’s war with Iran, the rising cost of gas and his administration’s mass deportation agenda. Organisers claimed that this was the biggest mass demonstration in the country’s 250-year history.
- Trump’s approval rating fell to its lowest point of his second term in March, with the Iran war weighing on public sentiment as rising oil prices push fuel costs above $4 a gallon for the first time. Prices have surged more than $1 since late February, while diesel has climbed above $5.45. A YouGov poll released on Wednesday shows that only a minority of Americans support the conflict. At the same time, inflation remains the top concern for voters, adding pressure on the administration ahead of the midterm elections.
- Several European nations have stepped up their opposition to the Iran war, exposing deep divisions within NATO. Allies France, Spain and Italy have refused direct military involvement and limited access to bases and airspace, while Germany has restricted its role to defensive support. The pushback has frustrated Trump and raised concerns about the alliance’s unity, increasing the risk of a broader transatlantic rift.
- Nvidia is taking a $2 billion stake in Marvell Technology and expanding its AI ecosystem to allow Marvell to integrate custom chips and networking equipment. The companies will also collaborate on silicon photonics and telecom-linked AI infrastructure. Marvell shares rose as much as 11%, while Nvidia gained up to 3.8% following Tuesday’s announcement, which coincided with a broader stock bounce.
- OpenAI raised $122 billion in its largest funding round, completed on Tuesday, and valuing the company at $852 billion as it accelerates spending on chips, data centres and talent. Major investors included Amazon ($50 billion), Nvidia ($30 billion) and SoftBank ($30 billion). The OpenAI funding ranks among the largest transactions in history, eclipsing previous startup rounds as investor demand surges for AI, seen as transformative across economies. OpenAI said on Tuesday that it’s currently generating $2 billion in monthly revenue.
- Anthropic is considering an initial public offering as soon as October, according to sources, as it competes with OpenAI in the race to list. The Claude developer has begun preliminary talks with Wall Street banks about a potential listing that could raise more than $60 billion, though no final decisions have been made. Anthropic was valued at $380 billion in a $30 billion funding round co-led by MGX that closed in February.
- Eli Lilly agreed to a deal with Insilico Medicine worth up to $2.75 billion, highlighting the growing role of AI in drug development. Announced on Monday, the agreement gives Lilly exclusive global rights to develop and commercialise a portfolio of AI-discovered drug candidates. At the same time, Insilico receives an upfront payment of about $115 million along with milestone payments and royalties. The deal underscores intensifying competition in the pharmaceutical industry to leverage AI to accelerate innovation and improve drug development success rates.
- Eli Lilly won US approval for its weight-loss pill Foundayo on Wednesday, intensifying competition with Novo Nordisk as the obesity drug market shifts toward oral treatments. Lilly shares rose as much as 6.2%, while Novo’s fell up to 2.6%, as investors bet the easier-to-use pill could accelerate growth in a market expected to exceed $100 billion by 2030. The review process took less than four months thanks to a new FDA programme designed to expedite access to promising medications that meet national priorities, offer innovative cures or address unmet medical needs.
- As of Wednesday’s close, the S&P 500 was 3.2% up for the week.
Local News
- The JSE shed about R3 trillion in March, marking its worst monthly rout since the 2008 financial crisis, as the Iran war halted a strong start to the year and triggered a broad sell-off. Mining and financial stocks led the declines as higher oil prices stoked inflation fears and dampened demand for emerging-market assets. The decline follows a 12-month rally through February, as investors unwind positions amid higher oil prices and inflation concerns.
- Trump’s tariffs have significantly reduced South Africa’s exports to the US, particularly in vehicles, metals and manufactured goods, the central bank said on Tuesday. Excluding precious stones and metals, export values declined 9.9% in the fourth quarter of 2025 after falling 15.6% in the third quarter, while including them showed a 2.9% increase, reflecting higher gold and platinum group metal prices. Export volumes have declined since late 2024, with a value peak of R293 billion in 2021, falling to $156.8 billion in 2024.
- The South African Reserve Bank said on Tuesday that the Iran war has clouded the outlook for the economy, interrupting a period of sustained expansion and driving a surge in oil prices. The bank warned that higher fuel costs are likely to push up inflation and reduce household spending, adding that a prolonged conflict could require interest rate hikes depending on how long the disruption lasts.
- South Africa cut fuel taxes by R3 per litre for petrol and diesel in April to cushion a surge in oil prices driven by the Iran war, with the measure expected to cost about R6 billion in lost revenue. Finance Minister Enoch Godongwana on Tuesday said the relief will be temporary, as fuel prices are set for their steepest increase in almost two decades.
- South Africa on Monday appointed Thabo Thage as minister plenipotentiary to Washington as it moves to restore diplomatic ties with the US. The role allows him to negotiate and sign agreements while serving as deputy head of mission. Pretoria has not had an ambassador in Washington since early 2025, following the expulsion of Ebrahim Rasool for remarks critical of Trump.
- Outgoing Commissioner Edward Kieswetter said on Wednesday that tax collection slightly exceeded expectations for the fiscal year ending March, with the South African Revenue Service collecting about R2.01 trillion, an 8.4% increase from the previous year and marginally above the National Treasury’s forecast. Revenue was supported by solid growth in corporate taxes, personal income tax, and VAT, despite a challenging backdrop of weak economic growth, geopolitical tensions, and supply chain disruptions. The stronger outcome supports projections that government debt has peaked as a share of GDP, although authorities warned that the illicit economy continues to erode potential tax collections significantly.
- Eskom plans to cut off electricity supply to 14 municipalities owing more than R110 billion, citing failure to meet debt-repayment arrangements. The move risks worsening South Africa’s power crisis, says University of Pretoria Economics Professor, Roula Inglesi-Lotz. Inglesi-Lotz said on Monday that municipalities rely on electricity sales for revenue and already struggle with weak finances, poor governance and low payment rates. Disconnections could hit low-income households hardest, as most consumers receive power via municipalities and may face reduced access and economic strain.
- Coca-Cola plans to invest about $1 billion (R17.6 billion) in South Africa through to 2030 to expand production capacity, strengthen distribution and drive innovation across the “Coca-Cola system’s” value chain. The investment, announced on Tuesday at an investment conference in Johannesburg, aligns with the government’s effort to attract R2 trillion in new investments into the country over the next five years.
- MTN has committed to investing nearly R22 billion over the next three years to expand network infrastructure and connectivity in South Africa, as part of efforts to support digital transformation and economic growth. The announcement was made by MTN South Africa CEO Ferdi Moolman on Wednesday during the South Africa Investment Conference in Johannesburg, saying it is “in support of South Africa’s continued digital transformation and economic growth”.
- Starlink’s entry into South Africa remains delayed as the communications regulator has yet to act on a December directive that could allow alternative empowerment structures for telecoms licences. The SpaceX subsidiary is awaiting clarity while offering investment and connectivity commitments. Meanwhile, its bid in Namibia has been rejected over local ownership rules, with the company contesting the decision and citing strong public support for its services.
- Chery plans to begin vehicle production at the Rosslyn plant in Pretoria, with the project expected to create about 3,000 jobs as it shifts from importing to local manufacturing. The move to revive the former Nissan facility signals growing momentum for domestic production, with industry participants noting that expanding into full-scale manufacturing could help strengthen South Africa’s industrial base and competitiveness.
- As at the time of writing, the rand was 0.8% stronger against the dollar, and the ALSI was 1.7% up for the week.
Sources: Dynasty, Bloomberg, NBC News, Reuters, Business Day, BizNews, ITWeb, Business Report, WSJ, etc.
