Markets Today: Oil surges 8% & stocks retreat as Trump keeps investors guessing, FED speakers & NFP ahead

• Geopolitical risks from the US-Iran conflict sparked a sharp "risk-off" reversal across global markets
• Brent and WTI crude surged past the $100 per barrel mark, escalating global inflation expectations
• Equities (like the STOXX 600) and precious metals (like gold) retreated, while the US Dollar strengthened as the primary safe-haven asset.
• Attention now turns to comments from Federal Reserve speakers and tomorrow's highly anticipated Non-Farm Payrolls (NFP) report.

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Markets were sent into a tailspin on Thursday as geopolitical risks once again took center stage, overshadowing recent hopes for a diplomatic breakthrough. Investor sentiment, which had been tentatively recovering, faced a sharp reversal as the prospect of a prolonged conflict between the US and Iran sent shockwaves across asset classes.

In a prime-time address, President Trump’s rhetoric struck a dual chord—promising to hit Iran "extremely hard" while simultaneously claiming the end is in sight. This ambiguity is precisely what the markets dislike. Without a concrete exit strategy, the risk-off mood is likely to persist.

As we look ahead to the North American session, keep a close eye on the $85 level for Brent as a key pivot point, while equity bulls will need a significant de-escalation headline to regain control of the narrative. For now, the "wait-and-see" approach remains the most prudent path as geopolitics continues to overpower fundamental data.

Safe-Haven Demand Propels the Dollar

The US Dollar regained its footing, firming up as the "safe-haven of choice" while uncertainty gripped the session. We’ve seen this playbook before: when clarity is lacking, the greenback thrives.

Oil’s Volatile Ascent

The most dramatic reaction remains in the energy sector. Brent and WTI crude surged well over the $100 per barrel mark, a psychological level that will likely weigh heavily on global inflation expectations. President Trump’s recent remarks, while suggesting that military objectives are nearing completion, failed to provide the one thing markets crave most: a definitive timeline.

From a technical perspective, if oil sustains its break above $100, we could see a further squeeze toward the $110 handle, especially if supply-side fears continue to dominate the narrative.

European equities took a significant hit on Thursday, with the STOXX 600 dropping 1.2% to 589.99 points. The reversal comes as a cold shower for market participants who, just 24 hours ago, were buoyed by hopes of an imminent diplomatic resolution. Instead, the narrative has shifted back to escalation, leaving the index struggling to maintain its weekly gains.

The divergence in sector performance today highlights a classic "risk-off" environment:

• Tech & Miners Under Pressure: Technology stocks led the decline, sliding nearly 3%, while the basic resources sector dropped 2.7% as precious metals lost their luster.
• Energy Outperforms: Brent crude surged past the $100 per barrel mark—a 7% jump—propelling energy stocks up 1.2%. This remains the only major sector in the green.
• Aviation Struggles: The spike in fuel costs sent airline heavyweights like Air France and Lufthansa tumbling over 3.7%, as the prospect of prolonged high oil prices threatens margins.

Perhaps most concerning for the medium term is the shifting expectation for monetary policy. Before this conflict, markets were pricing in a "wait-and-see" approach from the ECB. Now, LSEG data shows interest rate futures are pricing in three 25-basis-point hikes by year-end.

The continued closure of the Strait of Hormuz remains the ultimate wildcard. As long as this strategic artery is blocked, the twin threats of stagflation, rising prices coupled with slowing growth will continue to hang over European markets like a dark cloud.

Expect liquidity to thin out as we head into the long weekend, but keep a close eye on the $100 level in Brent. If oil holds these gains, the pressure on European equities and the ECB will only intensify.

The yellow metal’s recent rally hit a brick wall on Thursday, as the safe-haven trade faced a violent unwinding. After touching its highest level since March 19, spot gold (XAU/USD) tumbled over 2.8% to trade around $4,622 per ounce. At one point in the session, the carnage was even more pronounced, with prices sliding more than 4% and decisively snapping a four-day winning streak.

Gold is currently caught between a rock and a hard place. While geopolitical jitters remain, the lack of a "new" catalyst for escalation, combined with a strengthening Greenback suggests that the recent rally may have run its course for now. Keep an eye on the $4,600 level; it’s the line in the sand for the remainder of the week.

The weakness wasn't confined to gold, as the broader precious metals complex saw a sea of red:

Silver (XAG/USD): The most volatile of the bunch, silver plunged 5.4% to $71.07, after a stomach-churning 7% intraday drop.

Platinum & Palladium: The industrial-heavy precious metals also felt the heat, with Platinum falling 3.1% to $1,902 and Palladium shedding 1.8%.

The US Dollar reclaimed its throne on Thursday, as the "risk-off" switch was flipped back on across global desks. The Dollar Index (DXY), which tracks the greenback against a basket of major peers, climbed 0.53% to sit at 100.09.

The resurgence of the dollar put immediate pressure on the Euro and Sterling, both of which had been enjoying a period of relative strength:

• EUR/USD: The single currency slid 0.51% to $1.1531. Despite the shift in ECB rate hike expectations we’ve seen recently, the immediate need for safety outweighed the potential yield support for the Euro.
• GBP/USD: Cable took a harder hit, sliding 0.68% to $1.3216 as the broader flight to quality left the Pound vulnerable.
• AUD/USD: Often the first to feel the heat when global growth fears rise, the "Aussie" fell 0.69% to $0.6881. As a proxy for global risk appetite, the AUD’s decline underscores the market’s deepening anxiety over the duration of the Iran conflict.

Perhaps the most interesting move is in the USD/JPY pair. The Yen traded 0.5% weaker at 159.64, despite its traditional status as a safe haven. This paradox is likely due to the massive interest rate differential that continues to favor the greenback.

We are now effectively at the doorstep of the 160.00 handle. This is the widely recognized "line in the sand" for Japanese authorities. In my view, the closer we get to 160, the higher the probability of a "tap on the shoulder" from the Ministry of Finance. Traders should be wary of sudden spikes in volatility here, intervention risk is no longer a "maybe," it's a "when."

Currency Power Balance

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The European session is quiet today with markets waiting for comments from ECB policymakers.

Attention will firmly be on the US session where markets are waiting on Federal Reserve speakers Lorie Logan and Michelle Bowman, though the market is still largely vibing with Chair Jerome Powell’s dovish tone from Monday.

However, the real volatility catalyst arrives tomorrow with the Non-Farm Payrolls (NFP) report. While this data won't yet reflect the full economic scarring from the war, it will provide a critical baseline of labor market health that will undoubtedly steer the Fed’s immediate policy path.

Recent indicators offer a mixed bag: yesterday’s ADP figures surprised to the upside at 62k, while the ISM manufacturing employment index held steady at 48.7. As we head into tomorrow, the stakes are high:

Market Consensus: 65k

Macro Team Forecast: 60k

Bloomberg Whisper Number: 40k (notably more pessimistic)

I anticipate the unemployment rate will hold firm at 4.4%. Keep in mind that any unexpected spike in joblessness could trigger an outsized market reaction.

Finally, with the Easter long weekend approaching, be prepared for thinner liquidity tomorrow and through Monday, conditions that often amplify price swings.

The FTSE 100 is facing a critical juncture as geopolitical "war jitters" halt its recent recovery. On the H4 chart, the index has stalled just shy of the 200-period SMA (yellow line) at 10,406, a level that remains a major hurdle for bulls.

Price action has slipped back toward the 100-period SMA (blue line) at 10,183, which coincides with a key structural support at 10,101.

The RSI has dipped from overbought territory, signaling fading momentum. A break below 10,100 could expose the psychological 10,000 mark, while bulls need a clean break above 10,406 to shift the narrative.

FTSE 100 Four-Hour (H4) Chart, April 2, 2026

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