Monthly comment March 2026

Index

• Markets
• Economy
• Geopolitics
• Conclusions
• Allocation
• Market data
• Event calendar

Markets

March 2026 ended with sharp losses across nearly all major global stock markets, dominated by the escalation of the conflict in the Middle East between Iran, Israel, and the United States that erupted in late February. The main question on investors' minds was not whether the conflict would have an impact, but rather how long it would last: the more indecipherable the situation appeared, the more the perceived risk shifted from a mere inflationary flare-up to the risk of economic growth derailing.

In the United States, the Nasdaq 100 fell 4.9%, the S&P 500 5.1%, and the Dow Jones 5.4%, pushing the major U.S. indices into negative territory year-to-date. In Europe, losses were the sharpest globally: DAX -10.3%, Euro Stoxx 50 -9.3%, CAC 40 -8.9%, SMI -8.8%, FTSE 100 -6.7%, and FTSE MIB -6.1%. The rotation toward Europe that had characterized February came to an abrupt halt. In Asia, the Nikkei suffered the steepest correction at -13.2%, reflecting Japan's heavy reliance on energy imports, followed by the Hang Seng at -6.9% and the CSI 300 at -5.5%.

WTI crude oil closed at $101 per barrel, up 51% for the month. Precious metals performed unexpectedly: favoring cash and the dollar as protective assets, investors punished gold (-11.6%), silver (-19.9%), platinum (-17.5%), and palladium (-17.2%). In the bond market, yields rose across the curve, with the 10-year U.S. Treasury yield up 38 basis points to 4.317%. In the currency markets, the Swiss franc appreciated by 3.9% against the dollar, the euro lost 2.2%, and the yen weakened by 1.7%. The crypto sector showed relative resilience: Bitcoin +2.2% and Ethereum +7.5%, with altcoins posting mixed results.

Economy

On the central bank front, March marked a shift in the landscape. At its March 18 meeting, the Fed kept rates unchanged in the 3.50%–3.75% range by an 11–1 vote, confirming expectations of a single rate cut this year with inflation projections revised to 2.7% for 2026. Powell acknowledged the difficulty of balancing a slowing labor market with rising inflationary pressures, describing the current situation as “an energy shock of uncertain magnitude and duration.” The issue of succession remains in the background: Powell’s term expires in May, with Kevin Warsh nominated by Trump as his successor.

In Europe, the ECB unanimously left rates unchanged at 2.00% at its March 19 meeting. The shift in tone compared to February is clear: markets, which had priced in possible cuts before the conflict, now expect two hikes in 2026 with the possibility of a third by December. The new projections revised inflation upward to 2.6% for 2026—from the previous 1.9% in December—and growth downward to 0.9%, in a context where the risk of stagflation leaves central banks with limited room for maneuver. The Bank of England also kept rates at 3.75%, adopting a similarly wait-and-see stance.

Geopolitics

March 2026 was entirely dominated by the conflict in the Middle East. U.S. and Israeli airstrikes continuously targeted Iranian military installations, nuclear sites, and energy infrastructure. At the end of March, it was confirmed that Alireza Tangsiri, the commander of the Islamic Revolutionary Guard Corps Navy who had orchestrated the blockade of the Strait of Hormuz, had been killed.

The Strait remained the central focus of the month: Iran maintained de facto control over it, allowing transit only to ships from non-hostile countries, while the Tehran Parliament approved the introduction of tolls for transiting vessels. Treasury Secretary Bessent estimated the energy deficit in the markets at 10–12 million barrels per day.

On the diplomatic front, Trump alternated between conciliatory statements and explicit threats against power plants, oil wells, and Kharg Island. China and Pakistan presented a five-point plan for a ceasefire, while Iran authorized the passage of first ten and then another twenty oil tankers as a conciliatory gesture, and Trump suspended the threat against energy infrastructure until April 6.

On the night of April 1–2, Trump addressed the nation, stating that the objectives are “nearly complete” and that operations will last “another two or three weeks.” Iran responded that it is ready to fight “for at least six months”: the positions remain irreconcilable, but the markets reacted positively to Trump’s words.

Conclusions

We ended March 2026 with a slightly overweight equity allocation and a slightly overweight position in gold. Bonds and cash remain neutral. At the sector level, we favor Energy, Materials, and Industrials, while geographically we maintain a slight overweight in Europe and Asia, reducing our exposure to the United States.

The month was marked by sharp movements and extraordinary volatility, with market dynamics driven almost exclusively by developments in the Middle East conflict. Our asset allocation strategy actively managed positions across multiple fronts during the period; the asset allocation shown therefore represents a snapshot at month-end and does not necessarily reflect the positioning taken at various points throughout the period.

The start of April still unfolds against a backdrop of high uncertainty, with the conflict in the Middle East now in its fifth week and Trump’s statements regarding the imminent conclusion of operations still lacking a specific date. Active and tactical portfolio management remains the most appropriate approach for navigating a phase in which geopolitical developments can rapidly alter the landscape.

Allocation

Liquidity

Bonds

Equity

Precious metals & Commodities

Geo-tactical allocation

Switzerland

Western Europe ex Switzerland

North America

Latin America

Asia Pacific

Top sectors

1. Energy
2. Materials
3. Industrials

Market data (data as of 31.03.2026)

Event calendar

Legend