Dollar and crypto gain as gold lags in conflict
The U.S. dollar and cryptocurrencies have emerged as unexpected winners during the Iran conflict, while traditional safe-haven assets such as gold and Treasurys have underperformed.
The shift follows U.S. and Israeli strikes on Iran from Feb. 28, with elevated oil prices above $100 per barrel driving inflation concerns and reshaping investor behaviour.
“This is what happens when you have a conflict that triggers stagflation risk: It becomes difficult to trade it,”
Said ITC Markets strategist, Daniel Tenengauzer.
Rising inflation expectations have triggered a selloff in U.S. government bonds, pushing Treasury yields to their biggest two-week increase in nearly a year and reducing demand for fixed-income assets.
The stronger macro backdrop has also lifted the U.S. dollar, with the ICE Dollar Index climbing more than 2% this month as markets scale back expectations for Federal Reserve rate cuts.
Meanwhile, cryptocurrencies have gained ground, with Bitcoin rising about 3.1% to $73,770 and Ethereum up 7.9% to $2,298, outperforming a 2.7% decline in the S&P 500.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
You may also like
US PPI report to test Bitcoin, gold and Nasdaq as December rate hike looms
Nvidia falls to its lowest valuation in 14 years! "Super bull" Tom Lee calls for bottom fishing, retail investors are buying more as it drops, but Wall Street is divided
After the market opened on Thursday, retail investors went against the trend and bought up Nvidia, with net purchases reaching $111 million in just half an hour, setting a record for the same period. Investors such as Tom Lee have publicly supported the company, with institutions optimistic about strong order backlogs extending to 2028, robust revenue growth, and opportunities created by declining valuations. Meanwhile, institutions like Bernstein and Goldman Sachs have become more cautious about Nvidia's outlook, with concerns focusing on management succession and technological leadership following Jensen Huang's departure.
Jane Street boosts Fidelity Bitcoin ETF stake 8x in Q3, trims BlackRock IBIT
From SpaceX to Anthropic, the market has new strategies for dealing with tech giants' IPOs
The market's response strategies to major listings are currently centered around "index inclusion expectations": the new regulations allow mega IPOs to be included in the six major indices within 15 days, triggering concentrated buying by passive funds. Investors are positioning themselves in advance and using options to hedge and amplify buying power. However, Anthropic has a free float of only about 6%; shares available for sale by employees on the first day and privately placed shares with no lock-up period may create supply pressure. On the other hand, index arbitrageurs are facing a rare opportunity.
Crypto prices
More
