24 March 2026

Corporate

Don't blink...

In a context where the conflict appeared to be bogging down, with the price of oil rising in response to announcements concerning the targeting of oil facilities and fears of attacks on strategic sites, D. Trump surprised observers on Monday by announcing a postponement of the ultimatum given to Iran for the reopening of the Strait of Hormuz, after discussions described as constructive with Iranian representatives. The price of oil eased immediately. However, the Iranians later denied that any such discussions had taken place. Markets ended slightly higher on Monday, taking these announcements with caution.


Dashboard1 :

Key indicatorsCurrent levelSince start of the YearSince start of the Intervention (27/02/26)
Brent crude oil102,91$+42,06$+30,43$
US Equities (S&P 500)6581-3,86%-4,33%
European Equities (Eurostoxx 50)5558-4,02%-9,45%
French equities (CAC 40)7724-5,22%-9,98%
US 10-year yield4,36+0,202+0,432
German 10-year yield2,99+0,142+0,352
French 10-year yield3,72+0,162+0,502

1Source: Bloomberg, 24/03/2026 (13:30), except for US equities as at 23/03/2026
2Percentage point: change in the interest rate. For example, an increase of +0.4 percentage point means that the rate rises from 3.0 to 3.04%

Our analytical framework :

Our analysis of this event is based on the monitoring of three key indicators that influence growth and inflation and, as a result, financial markets over the longer term.

Commodities

We have updated our growth and inflation scenarios. Without the Middle East conflict, we would have revised our growth forecasts upward and lowered our inflation expectations, given the momentum underway in investment. The conflict changes the picture, mainly due to the evolution of oil prices. At $90, the impact on growth would remain unchanged compared with our previous forecasts: 2.5% growth in the United States and 1.3% in the Eurozone. At $100, the impact would be -0.2 percentage point, bringing growth down to 2.3% and 1.1% respectively. At $130, with gas at €80/MWh, the impact would be more significant, with -0.5 percentage point of growth, resulting in growth rates of 2% and 0.7%. The price of oil is currently at $102, meaning the impact on growth is still limited compared with our forecasts.

Financial conditions

Market expectations for central bank policy rates have been particularly volatile. Before the conflict, markets were pricing in a 0.5 cut in interest rates in the Eurozone. Prior to the announcement of the postponement of the ultimatum, nearly four rate hikes were expected. Since then, expectations have shifted to roughly three hikes by the end of the year. For the time being, financial conditions have only a limited impact on growth, on the order of -0.1 to - 0.2 percentage point.

Duration of the conflit

The duration of the conflict remains the main uncertainty and will be a key factor for both growth and inflation. It is difficult to gain visibility, given D. Trump’s announcements—which were immediately denied by the Iranians—and the continuation of military operations.

Market Update – Monday, March 23, 20263 :

With fears of attacks on strategic energy sites and the threat of mining the Strait of Hormuz, markets opened sharply lower:

  • French equities (CAC 40) dropped by -1.45%
  • The French 10-year yield rose by +0.06%, from 3.75% to 3.81%
  • Oil remained at elevated levels, around $113

At 12:00, the U.S. President announced that he was postponing the ultimatum regarding the reopening of the Strait of Hormuz by five days, following very positive discussions with Iranian authorities. The reaction was immediate:

  • The CAC 40 rebounded by +4.44%
  • The French 10-year yield fell by -0.22%
  • Oil prices eased immediately, reaching $87

After the announcement, markets began to question D. Trump’s statement following Iran’s denial that any such discussions had taken place.
By the end of the day, markets finished slightly mixed:

  • The CAC 40 closed up +0.79% on the day
  • The French 10-year yield ended at 3.71%
  • Oil closed the day at $99.94


Bonds markets

Sovereign bond markets opened with a sense of distrust, triggering position unwinding and a widening of risk premia. The unwinding mainly affected shorter maturities (2-year bonds), whose yields rose sharply. Following D. Trump’s announcement, the rate trajectory completely reversed, with a strong decline in the afternoon.

In corporate bonds, the new element compared with the early weeks of the conflict is the weakening of flows. Until now, investors had remained very active buyers of bonds whose yields had risen, thereby supporting prices. This week, however, flows have dried up, and despite D. Trump’s announcement postponing the ultimatum, credit markets ultimately benefited little from the volatility. Investor behaviour will therefore need to be closely monitored to assess market liquidity.


Equity markets

The picture was similar in equities, with relatively low trading volumes throughout the day, likely reflecting doubts about the U.S. President’s announcement. The main U.S. equity index (S&P 500), after a strong rebound, eased slightly to close the session up 1.15%. European equities (Eurostoxx 50) gained 1.04%, and French equities (CAC 40) rose 0.76%. The rebound in markets mainly benefited cyclical stocks.

In this highly uncertain environment, we maintain our cautious stance. We are now neutral on bank stocks, which would be vulnerable to lasting impacts on growth and we are moving from a neutral to an overweight stance on the telecommunications sector.

2Sources : Bloomberg, 23/03/2026

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