Monthly Macro Review - March 2026

Macro at a glance

More than a month after the war began, the U.S. and Israeli offensive against Iran has stalled. What Donald Trump had described as a “quick operation” has turned into a regional conflict with far-reaching military, energy, and political consequences. Despite more than 10,000 targets struck, according to U.S. officials, the Iranian regime is holding firm and continues to strike back. Above all, Iran has succeeded in shifting the conflict’s center of gravity to the Strait of Hormuz, which it is largely blocking while hinting that passage might be granted to certain countries deemed neutral in exchange for payment. At the same time, Israel has resumed strikes against Hezbollah in Lebanon and invaded the southern part of the country, while the Houthis have fired multiple missiles toward Israel and are threatening to close the Strait of Bab el-Mandeb, a strategic axis connecting Europe and Asia. Following the death of Ali Khamenei, his son Mojtaba Khamenei took the helm of the regime, in a system increasingly dominated by the Revolutionary Guards. Officially, discussions are still ongoing through intermediaries. But their content remains unclear, and in Tehran many suspect Washington is primarily seeking to buy time while preparing a more aggressive military option. This concern is heightened by the arrival of additional U.S. Marines and airborne troops in the region, as several scenarios for ground operations are now being discussed around Kharg or key points related to the reopening of the Strait of Hormuz. For Trump, the danger is now twofold. If he backs down, he risks leaving behind a weakened Iran that is still capable of blocking the Strait of Hormuz and claiming a form of political victory. If he goes further, he could drag the United States into its most dangerous conflict in the Middle East since Iraq. And the longer the war lasts, the more its economic and electoral costs threaten the White House as the November midterms approach. (Reuters, Bloomberg, AFP, AP)

Both the Fed and the ECB kept their interest rates unchanged in March, with the Fed maintaining them at between 3.50% and 3.75% and the ECB at 2.00%. In the bond market, the yield on 10-year Treasury bonds stood at 4.43% and that on 2-year bonds at 3.93% at the close of trading on 27 March, their highest levels since July 2025. According to CME FedWatch, as of March 31, markets estimated the probability that the Fed would keep rates unchanged (or even raise them) by December at over 60.2%. In the CDS markets, the geopolitical repercussions of the conflict in the Strait of Hormuz have been equally evident: spreads on Qatar’s 5-year CDSs jumped by 60% between mid-February and mid-March, those on Bahrain’s by nearly 46%, those on Dubai’s by 54% and those on Abu Dhabi’s by 50%. (CME Fedwatch, S&P Global)

One Sector, One Insight

Basic Materials and Energy :

TotalEnergies SE (TTE.PA) will no longer aim to reach net zero emission targets by 2050, citing nations’ slower-than-expected shift away from fossil fuels and more stringent European Union regulations. The company will stick to its ambition of achieving carbon neutrality for its operations by the middle of the century, and continue to help clients cut pollution. TotalEnergies said it can’t formulate net zero targets conforming to European reporting standards due to uncertainties regarding global energy demand and the pace of deployment of low-carbon technologies. “We must, however, confront our ambition with reality,” CEO Patrick Pouyanne wrote in the company’s 2026 sustainabilityreport released on March 26. The transition to clean energy is underway, but at “a pace that doesn’t yet allow for the collective achievement of carbon neutrality as pursued under the Paris Agreement,” he wrote. (Bloomberg)

Consumption and General Public Services :

Unilever (ULVR.L) and McCormick (MKC) have agreed to merge Unilever Foods with McCormick through a “Reverse Morris Trust,” a tax-efficient structure in which Unilever first spins off its food division and then merges it with McCormick, rather than simply selling it outright. Under the terms of the agreement, Unilever and its shareholders will hold 65% of the entity after full dilution, Unilever will receive $15.7 billion in cash, and the transaction values Unilever Foods at nearly $45 billion, with the merged company estimated to be worth approximately $65 billion. This transaction allows Unilever to gradually exit the food market, as discussions with Kraft Heinz (KHC) had also taken place but did not come to an agreement. (FT, Bloomberg)

Financial Services :

On 19 March, the U.S. Treasury's FinCEN formally designated Zurich-based MBaer Merchant Bank as a “primary money laundering concern”, confirming that 80% of the bank's clients and 98% of its assets were tied to high-risk counterparties, including entities linked to sanctioned Iranian oil trading. A Bloomberg investigation published on 25 March further exposed the company’s deliberate positioning in illicit financial flows. Swiss regulator FINMA withdrew MBaer's banking licence and placed it in liquidation. The bank submitted an appeal but withdrew it, and proceedings were opened against four individuals connected to the bank. (AML Intelligence, Bloomberg, FINMA, Sullivan & Cromwell)

Healthcare :

In 2024, a Sydney tech entrepreneur, Paul Conyngham, learned that his beloved dog Rosie had cancer. After trying chemotherapy and surgery, which didn't help heal the tumors, Conyngham turned to ChatGPT for advice. It suggested immunotherapy and connected him to the University of New South Wales (UNSW). After paying the university for Rosie's genomic sequencing, he used AlphaFold (Google's DeepMind) to find mutated proteins as targets for treatment. With the help of Pall Thordarson (director of UNSW's RNA Institute), who developed a custom mRNA vaccine specially for Rosie, Rosie received her first injection in December and a booster in February. As a result, most of her tumors shrank significantly, and there was an improvement in her behavior, with her having much more energy. Thus, even though her cancer is not completely cured and her tumors have not fully disappeared, the quality of Rosie's life saw a major improvement, which highlights how the healthcare sector can greatly benefit from AI. (Fortune)

Industrials :

Volkswagen (VOW.DE) is discussing with Israeli defense company Rafael Advanced Defence Systems the possibility of converting its factory in Osnabrück, Germany, to produce components for the Iron Dome air defense system. This news was reported by the Financial Times, citing multiple sources. The plant would manufacture "support components" for the Iron Dome, not interceptor missiles. This event is a sign of the struggle of Germany's automotive sector to stay competitive and its shift toward producing military equipment. Furthermore, the German security and defense industry association proposed repurposing inactive auto capacity for defense purposes. Currently, the Osnabrück plant employs 2,300 workers and produces the T-Roc Cabriolet, which will no longer be made by mid-2027. Although there is no finalized agreement yet , as VW says it's still exploring options, for the project to be put into motion, the works council must first approve it.(DefenseNews)

Technology and Network Equipments :

An escalating helium shortage, fueled by the conflict in the Middle East and a direct strike on Qatar’s largest LNG facility, threatens the global semiconductor supply chain. Qatar accounts for roughly 33% of global helium output, a gas indispensable for cooling silicon wafers and flushing toxic residue during chip fabrication. While Air Liquide (AI.PA) VP Armelle Levieux stated the company is diversifying sources and assessing stockpiles, the technical volatility of liquid helium limits reserves to approximately 1.5 months before the gas becomes dangerous to store. South Korean firms Samsung Electronics (005930.KS) and SK Hynix (000660.KS) are most vulnerable, relying on Qatar for nearly 66% of their supply. Although TSMC (TSM) reports no immediate impact, analysts warn that the closure of the Strait of Hormuz has stranded 200 specialized containers. Given the high cost of halting fabrication, chipmakers are expected to outbid other sectors, likely driving up production costs for AI-grade silicon. (NYT)

The stock of the month

CF Industries (CF) surged 30% in March, hitting an all-time high of $141 on Monday. The rally is primarily driven by the escalating Iran-Israel conflict, which has crippled production in the Middle East, a region responsible for nearly 50% of global urea and 30% of ammonia exports. With the Strait of Hormuz effectively closed to tankers, global urea prices have spiked over 30%, reaching $665/ton. As the dominant North American producer, CF holds a decisive energy-to-food bridge advantage. While European competitors face gas prices up 85% month-on-month, CF benefits from the Permian Basin’s oversupply of cheap nitrogen-heavy natural gas, which acts as a low-cost feedstock. (Reuters)

Key performances

Name	As of March 31	Monthly change	YTD
S&P500	6528.52	-5.09%	-4.63%
Dow Jones	46341.51	-5.38%	-3.58%
NASDAQ	21590.63	-4.75%	-7.11%
FTSE100	10176.45	-6.73%	2.47%
CAC40	7816.94	-8.90%	-4.08%
DAX	22680.04	-10.30%	-7.39%
SMI20	12776.79	-8.83%	-3.70%
MSCI WORLD	4262.91	-8.62%	-6.02%
VIX	25.25	27.14%	68.90%
CHF/USD	1.2511	-3.80%	-0.91%
CHF/EUR	1.0826	-0.75%	1.62%
Brent $/bbl	103.28	42.49%	66.80%
Gold Spot $/oz	4699.60	-10.15%	7.54%

Upcoming events

Apr 5: OPEC+ meeting (first meeting since the beginning of the war)

Apr 10: US CPI (March)

Apr 28-29: US FOMC meeting

Written by Hippolyte Metzger-Otthoffer, João Vieira, Anastasia Kosolompova and Cyrille Desponds