DBG Markets: Market Report for Mar 4, 2026

Global Equities Slide on Middle East Tension: Brace for More Impact？Oil, US Indices, Gold & CAD Outlook

Global markets are bracing for prolonged uncertainty as the conflict between the US, Israel, and Iran escalates. The immediate threat of transit disruptions through the vital Strait of Hormuz has reintroduced a massive geopolitical risk premium into the energy markets.

While the energy sector thrives on the chaos, global equities are feeling the heat, with US stock markets facing the risk of a deeper correction as investors rapidly rotate capital out of risk assets and into safe havens.

Oil Surges as Fears of Supply Disruptions

With Iran warning that it will attack any ships attempting to pass through the Strait of Hormuz, oil prices surged again yesterday, fueled by fears that supply disruptions will further intensify.

Following reports of potential shipping bans and vessel movements pausing, logistical bottlenecks have created immediate short-term supply risks that could evolve into a prolonged crisis if there is no significant de-escalation in the region.

Brent Outlook

UKOIL, Daily Chart

Undoubtedly, oil continues to dominate market headlines. Prices surged again during Tuesday's session, driving Brent crude (UKOIL) past the 80.00 mark to hit an 8-month high.

With the breakout above this key technical and psychological level, the 80.00 mark now serves as an immediate support floor. As long as transit through the Strait of Hormuz remains compromised, oil prices will likely stay firmly elevated.

The next target could now sit between the 87.00 and 90.00 zone, reflecting highs last seen in mid-2025, which currently stands as the major liquidity zone.

Equities Face Correction Risk Amid Energy Surge

In the equities market, global indices are facing a brutally massive sell-off, particularly across European and Asian markets. Meanwhile, the US market also experienced heavy selling, and despite a late-night rebound, the risk of a much deeper correction remains highly elevated.

The combination of surging oil prices, which reignite inflation fears, and a stronger US Dollar is creating a highly toxic environment for equities. This means that despite recent resilience, the US market may not be spared from this heavy wave of risk aversion.

Dow Jones Reversal Confirm？

The “higher for longer” interest rate narrative is now back in full force alongside broader risk aversion, and US indices are exhibiting significant structural weakness.

The Dow Jones Industrial Average (US30) has confirmed a break of its prior bullish structure due to recent heavy selling pressure, opening the door to a phase of greater short-term indecision.

US30, H4 Chart

As we covered earlier, the head and shoulders pattern on the US30 has played out. The neckline near 48,700 was broken, subsequently retested, and firmly rejected.

The 48,700 level now acts as the major resistance pivot. A failure to regain ground above this level confirms that bearish momentum dominates, potentially triggering a deeper technical correction across the broader US market. The 48,000 marks now stands as the next critical pivot level.

US30, Daily Chart

Should we see a decisive break below 48,000, a deeper correction within the broader macro trend may push the Dow Jones down into the 47,000 to 46,800 zone, sending the index closer to its 200-day moving average.

Gold: Dip on Strong Dollar, But Broadly

Supported In the precious metals market, Gold experienced a significant dip yesterday as traders weighed a surging US Dollar and rising Treasury yields against the ongoing geopolitical panic.

The strength of the Greenback and shifting expectations away from near-term Fed rate cuts have introduced natural headwinds for the yellow metal.

XAUUSD, H2 Chart

However, from a technical perspective, Gold remains incredibly well-supported, with safe-haven demand highly likely to kick in on any substantial dips. Technically, the 5,000 to 5,100 region now acts as a formidable, ironclad support base.

As long as Gold maintains its footing above the 5,000 psychological level, the overarching bullish structure remains entirely intact.

Canadian Dollar: Benefiting from Commodities Gain

While the US Dollar dominates across the board, the Loonie is showing notable resilience. If oil prices remain elevated above the 80.00 mark, the CAD is well-positioned to maintain its strength against weaker major currencies, acting as a proxy trade for the surging energy sector.

USDCAD, Daily Chart

Technically, USDCAD failed to capitalize on broader Dollar strength to surge against the CAD, and is now capped below the 1.3700 major resistance level. With both currencies currently exhibiting dominant traits, USDCAD is likely to remain range-bound within the 1.3560 to 1.3700 area.

Bottom Line & Whats Next？

The financial markets are currently locked in a highly reactive state, completely overshadowed by the threat of a prolonged Middle East war.