During March, financial markets recorded a significant increase in volatility, primarily due to the deterioration of the geopolitical landscape following the United States' and Israel's attack on Iran and the subsequent closure of the Strait of Hormuz, a key location for global trade in oil, gas and other strategic raw materials. This increased uncertainty and triggered sharp movements in both equities and fixed income. Additionally, European debt markets experienced one of the most volatile months on record.

In this context, stock markets recorded general declines. In Europe, the falls were particularly sharp: the Euro Stoxx 50 fell 9.26%, the German DAX 10.30% and the CAC 40 8.90%, while the IBEX 35 fell 7.14%. In the United States, the drops were more moderate, with the S&P 500 falling by 5.09%, the Nasdaq 100 by 4.89% and the Dow Jones by 5.38%. In Asia, performance was more negative, with the Japanese Nikkei falling by 13.23% and the MSCI Asia Pacific by 13.35%, reflecting the impact of rising energy prices on economies that depend on crude oil imports.

In terms of performance by market capitalisation, the trend was homogeneous, with small and medium-sized companies behaving in line with larger companies. From a sectoral perspective, performance was driven by the sharp rebound in the energy sector. The global energy sector advanced 11.33%, in contrast to the declines in other sectors. Materials and industrials led the declines, together with the sectors most sensitive to interest rate fluctuations.

Source: Bloomberg and prepared by MoraBanc

In fixed income, the month was marked by rising yields, especially at the short end. The yield on the ten-year US bond closed at 4.317%, while the German bond stood at 3.004% and the Spanish bond at 3.505%. At the two-year term, the US yield increased by 42 basis points to 3.793%, while the German yield rose by 62 basis points to 2.616%, representing a 30.97% increase in relative terms. This movement led to declines in the main fixed income indices: the Bloomberg Global Aggregate fell by 1.97% and the Bloomberg Euro Aggregate by 2.52%. Likewise, credit spreads widened, especially in the high-yield segment.

In currencies, the dollar strengthened during the month, with the Bloomberg Dollar Spot Index rising by around 2.4%. In this environment, the euro depreciated by 2.19% against the dollar, to 1.1553. In commodities, energy accounted for the most notable movements. Brent rose by 63.29%, WTI by 51.27%, and European gas by 58.83%. In contrast, precious metals corrected, with gold falling by 11.57% and silver by 19.85%. Meanwhile, bitcoin advanced by 4.07% in US dollars and by 6.40% in euros, showing resilience despite the increase in volatility.