Global stock markets have risen for three consecutive years, with South Korean stocks rising by more than 5%, Samsung and SK Hynix rising by more than 7%, oil prices falling, and the market waiting for the Federal Reserve's decision.

# Zhang Yaqi

Source: WallStreetCN

South Korea’s KOSPI Index rose more than 5% during the day to break above the 5,900-point mark, with Samsung and SK Hynix both surging over 7%. South Korea’s financial regulator stated it would expand its 100 trillion won market stabilization plan if necessary. The MSCI World Index gained 0.3%, logging its longest winning streak in more than a month. Brent crude fell about 2.3% to trade near $101 per barrel. Gold dropped 0.4% to below $5,000 an ounce. Market focus will shift to the Federal Reserve’s interest-rate decision later on Wednesday, with the tone of Jerome Powell’s press conference in sharp focus.

Global stocks rose for a third straight day amid uncertainty, as investors looked past recent geopolitical tensions. Oil prices retreated after a larger-than-expected build in U.S. crude stockpiles and the opening of alternative export routes from Iraq, temporarily easing the worst fears over energy supplies.

On March 18, the KOSPI Index broke above 5,900 points, rising more than 5% intraday. Shares of Samsung and SK Hynix both jumped more than 7%. South Korea’s financial regulator said it would expand its 100 trillion won market stabilization program if needed. The MSCI World Index advanced 0.3%, notching its longest winning streak in more than a month. U.S. and European stock futures also rose, suggesting the rally could spread to more markets.

In the oil market, Brent crude fell roughly 2.3% to around $101 a barrel. Data from the American Petroleum Institute (API) showed that U.S. crude stockpiles rose by 6.56 million barrels in the week ending March 13, far exceeding the 380,000-barrel increase expected in a Reuters poll. At the same time, Iraq signed an agreement to resume crude oil exports via Turkey, bypassing the Strait of Hormuz and putting further downward pressure on prices.

The pullback in oil prices supported gains in U.S. Treasuries, with the 10-year yield falling 2 basis points to 4.18%. Gold declined 0.4% to below $5,000 an ounce. Attention now turns to the Federal Reserve’s policy decision due later Wednesday, with the wording in Powell’s press conference being highly anticipated.

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### Key Market Levels

- KOSPI Index: rose above 5,900 points, up over 5% intraday

- Samsung, SK Hynix: both up over 7%

- S&P 500 futures: +0.4%

- Euro Stoxx 50 futures: +0.7%

- U.S. Dollar Index: -0.06%

- Japanese Yen: +0.2% to 158.74 per dollar

- 10-year U.S. Treasury yield: -2 bps to 4.18%

- Brent crude: -2.3% near $101/bbl

- WTI crude: -3.37% to $92/bbl

- Gold: -0.4% below $5,000/oz

- Bitcoin: -0.7% at $74,025.23

### Oil pressured by stockpiles and alternative export routes

Several factors combined to push oil prices lower in the short term. According to Reuters, the API’s much larger-than-expected weekly increase in U.S. crude inventories weighed on sentiment. Meanwhile, U.S. forces used bunker-busting bombs to destroy Iranian missile sites near the Strait of Hormuz. Oil analyst Andy Lipow commented, “This has brought some optimism to the market, suggesting that tankers may soon be able to return safely to the waterway.”

An alternative export deal signed between Iraq and Turkey has also created a new route for global oil supplies to bypass the Strait of Hormuz, further easing some risks of supply disruption.

However, supply disruption risks have not completely faded. There have been repeated attacks on energy infrastructure in the UAE recently, including drone strikes on the world’s largest ultra-sour natural gas facility, a fire at the Fujairah oil industrial zone, and damage to an oil tanker near the Strait of Hormuz. The Shah natural gas field—operated by ADNOC and Occidental Petroleum, with a production capacity of over 1.28 billion standard cubic feet per day—remains suspended after a fire caused by a drone attack.

Citi warned that while oil faces short-term downward pressure, upside risks cannot be ignored. In its base case, flows through the Strait of Hormuz could be disrupted by 11–16 million barrels per day over the next four to six weeks, potentially pushing Brent crude to $110–120 per barrel.

Brent crude fell about 2.3% to trade near $101 per barrel. WTI crude dropped 3.37% to $92.

### Fed decision becomes next major focus

As geopolitical tensions and inflation expectations continue to intertwine, markets are turning their attention to the Federal Reserve’s interest-rate decision on Wednesday. Although policymakers are widely expected to hold rates steady, the tone of Powell’s press conference will be critical. Investors are eager to understand how the Fed would respond if the conflict creates competing pressures on the labor market and inflation goals.

Bond traders have been gradually scaling back aggressive bets that the Fed would keep rates on hold for all of 2026, but expectations around the rate-cut path remain divided. Tony Sycamore, market analyst at IG Australia, wrote in a note:

“If the conflict continues to push energy prices higher and therefore lift inflation, it would strengthen expectations of a stronger U.S. dollar and further limit the Fed’s room to ease policy.”

The U.S. Dollar Index edged down 0.06% on Wednesday. Bloomberg macro strategist Brendan Fagan noted that the partial stabilization in oil prices has provided some support to government bonds, but until price pressures ease sustainably, market moves will remain driven more by geopolitics than monetary policy itself.

### Analysts: Volatility unlikely to fade until energy situation stabilizes

Although overall market sentiment has improved, strategists generally warn that high volatility is likely here to stay until energy markets truly stabilize. Veteran strategist Louis Navellier said that U.S. stocks’ ability to rise even amid higher oil prices mainly reflects solid expectations for corporate earnings and economic growth. However, he emphasized, “Investors should expect market volatility to persist until the energy situation stabilizes.”

David Chao, strategist at Invesco, warned that historical data show it takes “an average of about four to five months” for oil prices and equity markets to recover from supply-side shocks. This suggests that even if tensions ease in the near term, it will take time for markets to fully absorb the impact.

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