Daily Market Outlook, March 5, 2026 

Patrick Munnelly, Partner: Market Strategy, Tickmill Group

Munnelly’s Macro Minute…

U.S. stocks saw gains as new economic data pointed to a robust services sector and cooling price pressures, helping to ease worries about the intensifying conflict in the Middle East. Meanwhile, Bitcoin briefly surpassed $73,000, and oil prices fluctuated throughout the day. The market got a boost after reports revealed the U.S. services sector is growing at its quickest pace since mid-2022, accompanied by a drop in a key price index to its lowest point in nearly a year. The developments fuelled optimism about the economy's resilience. A surge in major tech stocks added to the positive momentum, with the Nasdaq 100 climbing 1.5%. Nvidia grabbed attention after its executives downplayed expectations of investing $100 billion into OpenAI. Oil prices saw wild swings but eventually settled near $75 per barrel. On the geopolitical front, tensions in the Middle East dominated news cycles. President Donald Trump voiced confidence in the ongoing US military actions against Iran, though the timeline for operations remained unclear. Iran launched strikes targeting Israel and Gulf nations, while Israeli and US forces responded with additional attacks inside Iranian territory. In a dramatic development, US forces reportedly sank an Iranian warship in international waters. Iran, however, dismissed claims that it had sought talks with Washington to de-escalate the situation. The global stock market rebound made its way to Asia, with South Korea bouncing back from its steepest plunge on record. Markets began to steady after the turmoil sparked by the Middle East conflict caused shockwaves among investors. The MSCI All Country World Index climbed 0.4%, marking the first rally for Asian stocks since the Iran war erupted over the weekend. South Korea’s main index surged 11%, recovering from a dramatic 12% drop in the previous trading session. While equities showed signs of resilience, other markets told a more cautious story. Crude oil prices continued to climb amid fears of prolonged instability, and gold gained as investors sought refuge in the precious metal. U.S. Treasury yields rose, with the 10-year yield ticking up 3 basis points to 4.13%. In a significant development, China's government directed its major oil refiners to halt exports of diesel and gasoline. This move comes as the escalating conflict disrupts crude oil supplies from one of the world’s most critical production hubs. Despite this, Chinese stocks posted gains even as the nation set its 2026 GDP growth target at a modest 4.5% to 5%—a pace not seen since 1991. The markets may have found some footing, but uncertainty continues to loom as geopolitical tensions and economic crosscurrents keep investors on edge.

We expect the war in the Middle East to continue driving market volatility in the near term. However, the steady stream of economic data will remain a vital gauge of the economy's trajectory, offering insights into growth, inflation, and policy outlooks. Despite energy price fluctuations stemming from the conflict, these have not yet had a prolonged impact on underlying fundamentals. Next week, key US economic data will be in focus, starting with February's Consumer Price Index (CPI) on Wednesday. Recent Producer Price Index (PPI) and Personal Consumption Expenditures (PCE) data have sparked concerns that disinflation may be slowing, with Nowcasts reflecting an upward trend. The consensus forecast for headline CPI to hold at 2.4% year over year could prove overly optimistic, aligning with the historical pattern of elevated inflation early in the year. Trade data follows on Thursday, leading into a busy Friday with January PCE, capital goods orders, the second estimate of Q4 GDP, and Michigan sentiment. In the UK, the calendar is lighter, with the BoE/Ipsos inflation expectations survey on Tuesday as the main highlight early in the week. Attention shifts to Friday with the release of January GDP, alongside production and trade data. Europe sees a quieter week, with only the final February country CPIs trickling in, as well as Eurozone Sentix on Monday and industrial production data on Friday. China begins the week with trade data on Tuesday and is expected to conclude with money and credit figures, likely on Friday. There will be a subdued flow of central bank speakers. BoE Governor Bailey is set to deliver opening remarks at the FSB payment summit on Thursday. With the Federal Reserve in its blackout period ahead of the March 18 FOMC meeting and the ECB entering its quiet period on Thursday, commentary from policymakers will be limited.

Overnight Headlines

  • US Senate Clears Way for Trump on Iran War Despite Stark Divide

  • Iran Denies Axios Report That Messages Were Sent To US

  • Judge Orders Gov. To Begin Refunding More Than $130B In Tariffs.

  • US Postal Service Taps Restructuring Firm Amid Cash Crunch

  • EU to Push Partners To Cover €30 Billion Aid Gap For Ukraine

  • Australia Household Spending Rebounds as RBA Weighs Another Hike

  • China Sets Lowest Growth Target Since 1991 as Old Model Falters

  • Supertankers Begin To Back Away From Gulf As Hormuz Crisis Bites

  • Crude Oil Prices Pressured By Bearish EIA Inventory Report

  • Broadcom CEO Sees AI Chip Sales Topping $100 Billion in 2027

  • Nvidia Refocuses TSMC Capacity as Export Controls Stall China Sales

  • Nvidia CEO Huang Says $30B OpenAI Investment ‘Might Be The Last’

  • Morgan Stanley Lays Off 2,500 Employees Across All Divisions

  • Goldman’s Solomon Is Watching For ‘Frothiness’ In Private Credit

  • Bets Against Blue Owl Hit All-Time High on Private Credit Fears

  • Apollo’s Zito Sees Private Credit Pain Lasting Up to 18 Months

  • Citadel Securities’ Rubner Lifts Bearish Call, Sees March Bounce

  • Baker Hughes Seeks To Sell $10 Billion. In Cross-Border Bond Sale

  • Marsh, Aon In Talks With US On Insuring Tankers In Hormuz

  • Bayer Wins Court Nod for $7.25 Billion Roundup Settlement

  • Korean Stocks Rebound On Chipmaker Gains After Record Sell-Off

FX Options Expiries For 10am New York Cut 

(1BLN+ represents larger expiries and is more magnetic when trading within the daily ATR.)

  • EUR/USD: 1.1600 (EU2.22b), 1.1685 (EU1.92b), 1.2225 (EU1.31b) 

  • USD/JPY: 150.00 ($1.43b), 153.00 ($1.16b), 157.00 ($1.04b) 

  • AUD/USD: 0.7000 (AUD1.5b), 0.7150 (AUD1.38b), 0.6950 (AUD943.4m) USD/CNY: 7.0500 ($495.5m), 6.8540 ($300m) 

  • GBP/USD: 1.3300 (GBP541.5m), 1.3350 (GBP535.7m), 1.3500 (GBP351.9m) 

  • USD/BRL: 5.12 ($759m), 5.21 ($754.4m), 5.18 ($712.8m) 

  • USD/CAD: 1.3840 ($320.1m), 1.3650 ($303.8m) 

  • EUR/GBP: 0.8725 (EU798.9m), 0.8750 (EU409m), 0.8800 (EU364.5m) 

  • USD/MXN: 18.20 ($344m), 17.50 ($337.4m), 17.16 ($300.7m) 

  • USD/KRW: 1445.00 ($464.3m) 

  • NZD/USD: 0.5950 (NZD924.8m), 0.5650 (NZD300m)

CFTC Positions as of February 27, 2026: 

- S&P 500 CME net short: +14,318 contracts (465,965 total)

- S&P 500 CME net long: +36,890 contracts (1,005,549 total)

- CBOT US 5-year Treasury futures net short: -92,311 contracts (2,064,931 total)

- CBOT US 10-year Treasury futures net short: -103,833 contracts (774,020 total)

- CBOT US 2-year Treasury futures net short: +113,628 contracts (1,348,036 total)

- CBOT US UltraBond Treasury futures net short: +5,299 contracts (280,487 total)

- CBOT US Treasury bonds futures net long: -1,351 contracts (5,074 total)

- Bitcoin net long position: 1,172 contracts

- Swiss franc net short: -41,186 contracts

- British pound net short: -57,072 contracts

- Euro net long: 156,856 contracts

- Japanese yen net long: 11,539 contracts

Technical & Trade Views

SP500

  • Daily VWAP Bearish

  • Weekly VWAP Bearish

  • Above 6960 Target 7040

  • Below 6850 Target 6600

EURUSD 

  • Daily VWAP Bearish

  • Weekly VWAP Bullish

  • Above 1.1860 Target 1.1960

  • Below 1.1685 Target 1.1515

GBPUSD 

  • Daily VWAP Bearish

  • Weekly VWAP Bearish

  • Above 1.3635 Target 1.3760

  • Below 1.3400 Target 1.3150

USDJPY 

  • Daily VWAP Bullish

  • Weekly VWAP Bullish

  • Above 156.30 Target 159.40

  • Below 155 Target 152

XAUUSD

  • Daily VWAP Bearish

  • Weekly VWAP Bullish

  • Above 5150 Target 5325

  • Below 5200 Target 4900

BTCUSD 

  • Daily VWAP Bullish

  • Weekly VWAP Bearish

  • Above 78k Target 81.5k

  • Below 75k Target 53k