Treasury Demand Weakens, Yields Surge Across the Curve

Market Overview

U.S. equities staged a volatile “rollercoaster” session yesterday. Early trading was weighed down by escalating Middle East tensions and weak Treasury auction demand, pushing all three major indices lower. The Magnificent Seven broadly retreated, with Oracle and Alphabet leading the decline.

However, sentiment reversed sharply in the final hour of trading. Reports indicated that the United States had presented Iran with a 15-point ceasefire proposal, while former President Donald Trump suggested negotiations had made progress. The news triggered a dramatic sell-off in WTI crude, which plunged more than 6% within an hour after the close, nearly erasing all intraday gains. Meanwhile, Nasdaq 100 futures surged over 1%, signaling a relief rebound after extreme market stress.

Precious Metals & Cryptocurrencies

Despite strength in both the U.S. dollar and Treasury yields, gold and silver showed notable resilience. Spot gold rebounded 1.4%, returning to around $5,140, while silver rallied nearly 3%. In contrast, the crypto market came under heavy pressure. A proposed U.S. “Clarity Act” that would prohibit interest-bearing stablecoin incentives triggered a sharp sell-off, with Circle plunging 20% and Bitcoin falling below the $70,000 level.

Technology & Small Caps

During regular trading hours, capital rotated toward defensive assets. The Russell 2000 outperformed, closing up 0.45%. Technology stocks bore the brunt of the sell-off, with Oracle dropping nearly 4.7% and Alphabet down 3.9%. The broader software sector remained under pressure, with related ETFs declining over 4%, reflecting valuation concerns amid the Federal Reserves persistent hawkish stance.

Fixed Income & FX

Weak demand in the Treasury market led to a sharp sell-off. The 2-year note auction was particularly disappointing, with indirect bidder participation falling well below average levels. This pushed the 2-year yield up more than 10 basis points to around 3.96%, while the 10-year yield also climbed in tandem. The U.S. Dollar Index rose 0.3%, continuing to exert pressure on non-dollar assets.

Key Themes AheadMarkets Bet on Ceasefire Agreement Next Week

Hours before Trumps remarks on Monday, a cluster of newly created accounts on prediction platform Polymarket placed sizable bets that a ceasefire agreement would be reached by March 31 or April 15. These accounts collectively wagered approximately $160,000, with potential profits exceeding $1 million if a deal is reached by month-end. The scale and timing of these trades have reignited speculation حول possible insider political positioning.

Explosion at Major U.S. Refinery

One of the largest refineries in the United States, Valeros Port Arthur facility—with a daily capacity of nearly 400,000 barrels—experienced a major explosion and fire on March 23. The core hydrodesulfurization unit sustained severe damage. Analysts warn that prolonged downtime could further tighten already constrained gasoline supplies. Meanwhile, reports indicate that joint U.S.-Israel forces have conducted airstrikes on natural gas facilities in Isfahan and Khorramshahr, Iran.

Key Data to Watch(GMT+8)

• 20:30 (ET)U.S. Q4 Current Account Balance (USD)

• U.S. February Import Price Index (MoM)

• 22:30 (ET)EIA Crude Oil Inventories (week ending March 20)

• EIA Cushing Crude Oil Inventories

• EIA Strategic Petroleum Reserve Inventories