Early morning synchronized diving! Iran's latest warning! Market risk appetite continues to remain under pressure

Market risk appetite remains under sustained pressure!

On March 30, during the Asia-Pacific early session, US stock index futures all plunged together. As of the time of writing, the Dow Jones Industrial Average futures, Nasdaq 100 index futures, and S&P 500 index futures were all down more than 0.50%.

The cryptocurrency market also saw a plunge. During the day, Bitcoin, Ethereum, BNB, and XRP once dropped by more than 2%, Solana once fell by more than 3%, and Cardano once fell by more than 5%. According to CoinGlass data, within 1 hour, the crypto market’s total exchange-wide derivatives liquidation was nearly $200 million, of which 96% were long positions liquidated. As of the time of writing by our reporter from China Securities Journal, the declines in the above cryptocurrencies had all narrowed somewhat.

Regarding the latest developments in the situation in Iran, Iran’s Ministry of Foreign Affairs spokesperson Bagheri-E said that the proposals the United States submitted to Iran via the intermediary were extremely extreme and unreasonable. He also said that Iran must rely on its own strength to safeguard national security, ensuring that the United States and Israel will not launch attacks on Iran again.

In addition, on March 29, the spokesperson for the Hatam Anbiya Central Headquarters of Iran’s armed forces stated that the residences of US and Israeli military commanders and political officials would become lawful targets for Iran’s strikes. The spokesperson said this was a retaliatory measure against the relevant parties’ attacks on residential areas in multiple parts of Iran.

US stock index futures fall sharply across the board

On the morning of March 30, the three major US stock index futures fell across the board. During the day, the intraday declines in Dow Jones Industrial Average futures and Nasdaq 100 index futures were both once more than 0.80%, and S&P 500 index futures were also once down more than 0.70%. As of the time of writing by our reporter from China Securities Journal, Dow Jones Industrial Average futures, Nasdaq 100 index futures, and S&P 500 index futures were down 0.58%, 0.65%, and 0.57%, respectively.

International oil prices surged sharply during the day. WTI crude oil futures were up more than 3% during the day. As of the time of writing, WTI crude was up 2.76% to $102.39 per barrel; Brent crude was up 2.32% to $107.76 per barrel.

Matt Malley, Chief Market Strategist at Miletabark, said: “The escalation of the situation increases the likelihood that the war will last longer than investors had expected, so oil prices will remain at high levels. We should expect the stock market to weaken further.”

Michael O’Rourke, Chief Market Strategist at Jones Trading Company, said: “The global investment community wants to see progress on reopening the Strait of Hormuz. Meanwhile, selling has reached the point where the market needs liquidation events to stabilize.”

Because the conflict has pushed up gasoline prices, the US March consumer confidence index fell to a three-month low, and inflation expectations for the coming year have surged. According to Bloomberg’s latest monthly survey, economists raised their inflation expectations for the United States through year-end while lowering expectations for consumer spending, growth, and employment.

At present, policymakers at the Federal Reserve are weighing the durability of demand and the relatively steady hiring conditions, as well as the possibility of an unwanted rise in inflation driven by higher energy costs. On Monday, Federal Reserve Chair Powell will attend a moderated discussion at Harvard University, where he may provide clues on how to view the impact of this war on the risk balance between inflation and employment.

Some foreign media noted that the Federal Reserve may be sending cautious signals, but the bond market is increasingly pricing in a more hawkish stance from the committee. Last week, the yield on the 10-year US Treasury note (which moves inversely to bond prices) jumped to 4.48%, the highest level since July, as investors’ anxiety was not eased by Trump’s delay in strikes on Iran’s infrastructure. In the short end of the yield curve, the yield on the 2-year US Treasury note rose to 4% last Friday.

It is worth noting that these short-term yields have diverged from oil prices. After tracking crude oil prices for the first few weeks of the conflict, the 2-year US Treasury yield—typically seen as an indicator of the Federal Reserve’s expected policy path—has risen by more than 30 basis points since the Federal Reserve meeting, while oil prices have been roughly flat over the same period.

“Given this divergence between short-term interest rates and oil prices after the Fed meeting, we believe the market now expects the Fed’s reaction function to be more hawkish, and may also expect a broader commodities shock,” wrote Aditiabhavey, Global Research Director at Bank of America and global economist.

A change that would have been unimaginable before the outbreak of the Iran war is that traders currently assign a probability of 22% to the Federal Reserve raising rates by 25 basis points before the end of 2026.

Iran: The proposals put forward by the United States are extremely extreme and unreasonable

Citing the Iranian Islamic Republic News Agency on March 29, Xinhua News Agency reported that Iran’s Ministry of Foreign Affairs spokesperson Bagheri-E said in a media interview that the proposals the United States submitted to Iran via an intermediary were extremely extreme and unreasonable.

Bagheri-E said the US proposals involve matters related to Iran’s national sovereignty and contain no diplomatic seriousness. He also said that Iran must rely on its own strength to safeguard national security and ensure that the United States and Israel will not launch attacks on Iran again.

Bagheri-E said Iran’s military actions are not aimed at Arab countries, but rather at the US-Israel military bases and assets used to attack Iran. Bagheri-E said this is not a war between the American people and the Iranian people, but a war imposed on the region by the United States and Israel, and the United States must take responsibility for all consequences.

Pakistan’s Foreign Minister Dar said on the 26th that indirect negotiations between the United States and Iran are taking place by transmitting messages through Pakistan. Regarding the 15 points of the ceasefire agreement proposed by the US side, Iran’s Tasnim News Agency reported on the 26th, citing an insider, that Iran had formally responded.

Also, citing the Iranian Islamic Republic Broadcasting and Television on the 29th, it was reported that the spokesperson for Iran’s Hatam Anbiya Central Headquarters of the armed forces that day said that the residences of US and Israeli military commanders and political officials would become lawful targets for Iran’s strikes.

In addition, Major General Majid Mousavi, commander of Iran’s Islamic Revolutionary