This Week
On Saturday morning, Israel, alongside the US, launched strikes on Iran. President Trump signalled that the campaign may be prolonged, leaving markets highly focused on geopolitical risk and endangered energy supplies. Oil, gold, silver, and natural gas prices all jumped as trading opened Monday. The military campaign may overshadow the OPEC+ decision on Sunday to increase production by 206,000 bpd; however, OPEC could struggle to increase output with its members’ supplies being threatened by conflict.
The Nonfarm payrolls and unemployment rate data on Friday are the major economic releases of the week. US, Ukraine, and Russia negotiations might also take place.
Stocks
NETFLIX
Netflix’s stock price surged 23.1% after the company withdrew from a multi-month bidding war to purchase Warner Bros. Netflix previously bid more than $80 billion for the film company, but Paramount recently outbid Netflix. The news sent Netflix’s stock price skyward on Friday, with investors relieved that Netflix was walking away. The bid was widely reported to have been depressing Netflix’s stock price in recent months. Netflix also announced that it will spend $20 billion on content, its core business, widely seen as a better use of capital. Reports suggest that investment banks may upgrade the company’s price target. In the earnings season in January, Netflix reported better than expected results, but issued cautious guidance.
MODERNA
Moderna’s stock price increased 3%, rising to a more than one-month peak after the US FDA accepted the company’s MRNA flu vaccine proposal for full review, reversing an earlier decision rejecting the vaccine. In Europe, the European Medicines Agency on February 27th recommended the approval of Moderna’s combined Covid-flu vaccine, which could significantly boost future. On February 23rd, brokerage Piper Sandler raised its price target to $69, around 28% more than its current price.
Commodities
Crude Oil
Crude oil prices climbed 1.98% last week, with the commodity rising to another multi-month peak after US-Iran talks ended without a deal as expectations grew that the US would strike Iran, possibly as early as over the weekend. Markets also priced in an expected modest increase in OPEC+ output ahead of its meeting on Sunday. US inventories rose sharply, suggesting reduced oil demand in the short term, but this wasn’t enough to have much impact on oil prices, which were fully focused on the Middle East.
Gold
Gold prices advanced 2.2% as markets reacted to President Trump’s new tariff policy early in the week, and prices extended gains on expectations that the US might opt for a military confrontation with Iran. As US – Iran talks stalled later in the week, there was further demand for the precious metal. Major banks such as JPMorgan confirmed their recent price targets for gold, outlining that prices are expected to continue rising in the short to medium term.
SILVER
Silver prices soared 7.7% to a one-month high as safe-haven demand increased sharply for the metal. Silver prices benefited from changes to US trade policy, which saw the application of a new 10%-15% tariff, replacing emergency tariffs ruled illegal by the Supreme Court. But the prospect of conflict between the US/Israel, and Iran that could escalate further was the main price driver for silver. Tight supply and ongoing solid industrial demand continue to underpin silver prices.
GBP/USD
The GBP/USD slipped 0.33% after the sterling weakened following a significant by-election defeat for the governing Labour Party to the Green Party in a long-held seat. This heightened political uncertainty put renewed pressure on Prime Minister Starmer. Markets are pricing in Bank of England interest rate cuts perhaps as soon as this month, further pressuring the pound. The dollar was supported by higher-than-expected PPI inflation-linked data.
Recap
Last week, the S&P 500 fell 0.44%, the Nasdaq slipped 0.21%, and the Dow Jones declined 1.1%.
US stock indices pulled back as worries over AI costs, geopolitical tensions in the Middle East, and tariff uncertainties combined. Chipmaker NVIDIA posted blowout earnings results, and Netflix withdrew its bid for movie studio Warner Bros. Higher than expected inflation-linked US Producer Price data potentially delayed Fed rate cut, now seen in July.
Crude oil prices surged to fresh multi-month peaks as speculation grew that an attack on Iran was imminent, endangering energy supplies in the region. Natural gas prices declined amid further warmer US weather reports. Gold and silver prices both traded close to one-month highs as traders turned to safe havens on expected military conflict. Palladium prices edged lower, while platinum prices rose to a four-week high.