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Daily Macro

Macro Notes - Global Equity Market Reactions

March 05, 2026
Mehta Saakshi Headshot

Saakshi Mehta

Vice President, ETF & Alternatives Strategy

Global equity markets have exhibited significant divergence since the escalation of US-Iran conflict. As anticipated, performance patterns closely track regional energy sector exposure and correlation to crude oil prices, validating the hypothesis that energy sensitivity has become the primary driver of equity returns over the last week.

With geopolitical risk a key macro driver, commodity importers remain vulnerable the longer the conflict continues. That puts EAFE markets under a bit of risk in the near-term.

Chart 1: Equity Market Reactions around the world since US-Iran Conflict

Data as of March 4, 2026
Source: MSCI, Bloomberg, BMO GAM


Chart 2: Global Equity Returns and WTI Correlation

Daily data starting in Oct 2023
Source: MSCI, Bloomberg, BMO GAM


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