Weekly Market Update (Mar 22, 2026)

Market Hedwig
Mar 21
2 min read

HIGHLIGHTS

The energy prices remained elevated due to the Iran war and closure of the Strait of Hormuz.

Central Banks: Major central banks are responding with hawkish talk because of the higher inflation risks. ECB and BoJ are likely to be the first to hike.

IPO: The large index providers are proposing a change of requirements for index eligibility. It is related to the minimum length of time and float requirements. Nasdaq and FTSE Russell have launched public consultation while S&P and Dow Jones have not started but likely to follow.

EM: Emerging Markets equities have dropped almost 10% since the Iran war. Markets that are less sensitive to high energy prices are great buys, such as South Korea, Brazil and South Africa.

MARKETS

Nasdaq	21,647.61	-2.07%
S&P 500	6,506.48	-1.90%
Dow	45,577.47	-2.11%
10-Year	4.39%	+10bps
Brent	106.41	+7.58%
DXY	99.50	-0.86%

*Data as of market close. 5-day change ending on Friday.

VIEW FROM THE STREET

Equity

Standard Chartered: Asset allocation can tilt towards US assets as its economy is less affected by the Middle East conflict compared to EU and Asia, given US’s limited exposure to Middle East energy sources.

Morgan Stanley: In terms of positioning, we suggest buying the oversold large-cap, software, healthcare stocks, while cutting exposure in consumer stocks and overbought semiconductors. Industrials and materials remain the beneficiaries in the cycle.

Fixed Income

Barclays: Unlike the consensus, we think central banks are not going to be as hawkish as expected, especially in the emerging markets in Asia. Most are going to adopt the wait-and-see approach in near term.

Morgan Stanley: Before Iran war, investors priced in 1-2 rate cuts. Now, long-term rates are higher as markets expect Iran war and Supreme Court tariff decisions are going to increase deficits and debt.

Economy

J.P. Morgan: Due to the upside risk of inflation, almost 40bps of rate cuts this year have been priced out. By simple regression, 10% yoy increase in oil prices will boost headline inflation by 25bps in the following month.

UBS: Systematic risk from private credit remains. We downgraded direct loans, especially those in lower middle market and originated in 2021-2022. We expect the default rate to increase to 4%.

KNOWLEDGE TRANSFER

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DISCLOSURE

This newsletter is meant for informational purposes only and is not investment advice. Always consult a licensed investment professional before making important investment decisions. Advertising and sponsorship do not influence editorial content or decisions. Market Hedwig is not responsible for the promises made or the quality or reliability of the products or services offered in any advertisement.