Global equities posted sharp losses in March, with rising oil prices and geopolitical uncertainty weighing heavily on sentiment and expectations for growth.
BNN Bloomberg spoke with Melissa Brown, managing director of investment decision research at SimCorp, who said prolonged uncertainty around the conflict and elevated energy prices are key risks for inflation, earnings and investor confidence.
Key Takeaways
- March was a broadly negative month for equities, with declines across nearly all sectors except energy.
- Rising oil prices were the primary driver, weighing on inflation expectations, earnings outlooks and consumer confidence.
- Weakness in large-cap technology stocks added further downward pressure on major indices.
- Ongoing geopolitical uncertainty, particularly around the duration of the conflict, is amplifying volatility.
- Investors are focused on the U.S. jobs report for signals on labour conditions and potential Federal Reserve policy moves.
Read the full transcript below:
MATT: Our first guest this morning says March is on track to be one of the worst months for U.S. markets in years. Let’s get her perspective on why, along with other trends. Melissa Brown, managing director of investment decision research at SimCorp, joins us now. Melissa, thanks for being here.
MELISSA: My pleasure.
MATT: Let’s talk about March. We’re now at the beginning of April, and the level of volatility has been exceptional, even considering the unexpected nature of the war in Iran. Give us your sense of last month and why it has been one of the worst in years for U.S. markets.
MELISSA: It was on track to be one of the worst months in many years. It did improve on the 31st, so it didn’t end up quite as bad as it had looked on the 30th, but it was still a very weak month. Rising oil prices really put a damper on expectations for inflation, corporate earnings and consumer confidence, and that weighed heavily on stocks.
MATT: It was tough across the board. Clearly, we have the geopolitical situation in the Middle East, the Strait of Hormuz closure and rising oil prices again today following less certainty than expected from Donald Trump’s speech last night. Is that the main driver, or are there other factors that impacted markets last month?
MELISSA: That was probably the main factor. You also saw the AI trade lose some of its momentum. Those stocks dragged on the broader market, and because they make up such a large share of U.S. indices, they pulled markets down significantly. Losses were widespread. The only sector that performed well in March was energy. Everything else declined, which suggests concerns about higher oil prices were broad-based across sectors.
MATT: Investors were expecting clearer messaging from Trump’s speech about a possible end to the conflict, but that didn’t happen. He also raised the possibility of escalation. How does that uncertainty factor into your outlook?
MELISSA: The uncertainty around the timeline is a major issue. If you think back to the “Liberation Day” tariffs last year, there was a similar initial market reaction, but it was short-lived because there was a clear resolution. This time, there’s no defined endpoint. That creates challenges, especially as we move into second-quarter earnings. The longer oil prices remain elevated, the greater the pressure on consumers. Having clarity on timing would help investors significantly.
MATT: We’ve seen markets react positively when there’s even a hint of progress toward ending the conflict.
MELISSA: Absolutely. Markets want positive news and a reason to buy. However, the recent rebound came on relatively low trading volume, which suggests it wasn’t driven by broad investor participation. Sentiment remains negative. When news disappointed again, that’s why we saw an initial negative reaction this morning.
MATT: Let’s turn to the U.S. jobs report coming tomorrow — the first since the war began — though markets will be closed for the holiday. What are you expecting?
MELISSA: Expectations are for moderate job growth — not particularly strong, but still positive. That could allow the Federal Reserve to focus more on inflation, particularly from higher oil prices, rather than employment concerns. That raises the possibility of higher interest rates, which markets typically don’t welcome. We could see the unusual situation where a solid jobs report leads to a negative reaction because of what it implies for Fed policy.
MATT: And with markets closed, we won’t see that reaction until Monday.
MELISSA: Exactly. A lot can change between Friday and Monday, whether it’s oil prices or developments in the conflict, so the eventual reaction may differ from what we would normally expect.
MATT: Melissa Brown, managing director of investment decision research at SimCorp. Melissa, thanks for your time.
MELISSA: My pleasure.
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This BNN Bloomberg summary and transcript of the April 2, 2026 interview with Melissa Brown are published with the assistance of AI. Original research, interview questions and added context was created by BNN Bloomberg journalists. An editor also reviewed this material before it was published to ensure its accuracy and adherence with BNN Bloomberg editorial policies and standards.
