(The opinions expressed here are those of the author, a

columnist for Reuters.)

By Mike Dolan

March 23 -

What matters in U.S. and global markets today

By Mike Dolan, Editor-At-Large, Finance and Markets

President Trump's 48-hour deadline for Iran to fully open the

Strait of Hormuz, which expires on Monday, has sent stocks and

bonds plummeting around the world as the Middle East conflict

intensifies.

Trump threatened to "obliterate" Iran's major power plants if

Tehran didn't comply with his demand. Iran said it would

retaliate by hitting energy and water plants across the Gulf.

We're now in the fourth week of the war and there's no sign of

de-escalation. Quite the opposite.

I'll get into that and more below.

But first, listen to the latest episode of the Morning Bid

podcast, where I discuss today's global selloff - and the

curious disappearance of investors' usual hiding places.

Subscribe to hear Reuters journalists discuss the biggest

news in markets and finance seven days a week.

TICKING TIME BOMB

The global Brent crude benchmark passed $113 per barrel on

Monday morning, while West Texas Intermediate (WTI) hit $100

before easing back. Average U.S. gas pump prices are now

threatening to top $4 per gallon.

Major stock indexes in Asia fell on Monday, with Japan's Nikkei

closing down 3.5%, bringing its March losses to over 12% so far.

South Korea's KOSPI shed nearly 6%, meanwhile, as a trading curb

was activated for the fourth time this month.

MSCI's gauge of global equities has now fallen to its lowest

point since November 2025. European shares opened lower on

Monday morning, with the STOXX 600 falling more than 2% to hit a

four-month low. Wall Street futures were in the red ahead of the

bell.

At the same time, government bonds have been hit everywhere,

extending last week's selloff. Ten-year U.S. Treasury yields

rose to their highest levels in nine months, with no additional

Fed easing priced into the futures curve this year. In fact, Fed

futures now see a 75% chance of a rate rise by year end.

And wary of the potential outsized inflation impact from the

energy shock, money markets now also see three interest rate

rises from both the European Central Bank and Bank of England

for the rest of the year.

Not only are bonds not providing a safe harbour, but gold

continues to slide too, leaving cash looking like the only

option for many. The dollar edged up against a basket of major

currencies.

Meantime, the Japanese government signalled its preparedness to

intervene to tackle foreign exchange volatility as the yen edged

closer to the $160 threshold. The embattled currency has failed

to stage a rebound despite recent hawkish remarks from Bank of

Japan Governor Kazuo Ueda.

Returning to energy, additional upward pressure on prices seems

almost guaranteed amid the escalating threats and attacks in the

Middle East, even as the International Energy Agency mulls the

release of more stockpiled oil. These releases will happen "if

necessary", said IEA chief Fatih Birol, who added that opening

Hormuz remained the only real solution.

Chart of the day

Gold dove more than 8% on Monday to hit its lowest level of the

year, after logging its biggest weekly loss in about 43 years

last week. That came as the escalating Middle East conflict

stoked speculation of higher global interest rates to choke off

the inflationary impact of an energy price shock.

Failing in the moment as a war hedge and inflation buffer,

gold appears to be suffering from a reversal of last year's

speculative frenzy as investors look to cash up their best

performing assets.

Today's events to watch

* EU March flash consumer confidence (11:00 AM EDT)

* EU's Ursula von der Leyen begins a three-day visit to

Australia

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Opinions expressed are those of the author. They do not reflect

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