U.S. risk-on rally after Iran pause

U.S. indexes rallied: the Dow (DJIA) rose 1.38%, the S&P 500 (SPX) gained 1.15% and the Nasdaq (^IXIC) advanced 1.38% after President Trump posted that U.S.–Iran talks were 'very good and productive' and a five‐day postponement of strikes reduced the immediate geopolitical risk premium. European benchmarks were mixed, with Germany's DAX (DAX) up 1.22% and France's CAC (FRA40) up 0.79% while the FTSE 100 (UKX) slipped 0.24% as index rebalances prompted reweighting flows. Asian markets lagged despite the U.S. rally, led by the Nikkei (NKY) down 3.48% and the Hang Seng (HSI) down 3.54%.

Sectors: XLY (+2.21%), VGT (+1.60%) and XLB (+1.21%) led gains while XLV (-0.39%) and XLP (-0.14%) lagged. Top gainers: PAYP (+21.16%), APGE (+19.99%), AXTI (+18.81%). Top losers: SEDG (-9.60%), EL (-7.72%), ENPH (-7.59%).

The Chicago Fed National Activity Index fell to -0.11 for February from +0.20, signaling below‐trend growth that pressured cyclical assets and reinforced expectations of later policy easing. U.S. construction spending unexpectedly dipped 0.3% m/m in January to a $2,190.4B SAAR, with private residential spending down 0.8%, weighing on housing‐sensitive sectors. The ECB hosted its 13th Conference on Forecasting Techniques highlighting AI and large language models, a research priority that may influence nowcasts and euro‐area yield formation.

President Trump's post that talks with Iran were 'very good and productive' and a five‐day pause on strikes triggered a broad risk‐on rally, lifting U.S. equity futures and sending oil prices sharply lower as the geopolitical premium eased. S&P Dow Jones Indices' March quarterly rebalance and STOXX component changes effective March 23 forced index‐tracking flows into additions and out of deletions, creating short‐term liquidity and price pressure for names such as MU, LRCX, AMAT, PYPL, VRT, LITE and COHR. Several completed transactions closed on March 23, including Abbott's completion of its acquisition of Exact Sciences, Jacobs' acquisition of the remaining stake in PA Consulting, Sealed Air's completion of regulatory approvals related to its CD&R transaction, and Resonetics' acquisition of Resolution Medical. Announced deals on the day included EQT Real Estate's purchase of a 2 million square‐foot infill logistics portfolio in southern New Jersey and a series of mid‐market M&A disclosures.