Global markets rallied in the week ending 3 April 2026, with U.S. equities up 3–4% on tentative U.S.–Iran de-escalation signals. The NASDAQ had its best week since November, while U.S. 10-year yields fell from ~4.44% to ~4.31% after comments from Jerome Powell. Volatility remained elevated, with a mid-week reversal following remarks by Donald Trump, highlighting ongoing geopolitical risk. Oil stayed elevated (~$108–112/bbl), gold recovered (~$4,700/oz), and the Nikkei underperformed due to energy exposure.
Key Themes
- Relief rally, unresolved risk: Early de-escalation optimism drove gains, but conflicting signals kept volatility high.
- Yields eased, trend intact: 10Y yields fell ~12bps WoW, but inflation pressures remain elevated, supporting a “higher for longer” outlook.
- Oil remains pivotal: WTI rose ~12% to ~$112/bbl; markets expect a short disruption, but prolonged risk implies $150+ Brent.
- Energy importers under pressure: Europe, India, and Japan face inflation and growth headwinds (Eurozone inflation 2.5%, Germany growth cut to 0.6%).
- U.S. data resilient: Payrolls (+178k), ISM (52.7), and retail sales (+0.5%) indicate steady growth.
- Private credit stress persists: Platforms like Ares Management, Apollo Global Management, and BlackRock continue to face elevated redemptions, with wide spreads and discounted BDC valuations.
