Monthly Securities Market Summary
What happened in the securities markets? – 2026 March
Monthly report on government securities markets
2026. March
Domestic government securities market
Annual inflation continued to slow in February, falling from 2.1% in January to 1.7%, while monthly inflation rose by 0.4%. Core inflation moderated to 3.8%. Industrial production volume fell by 2.5% year-on-year in January and also showed a decline compared to the previous month, pointing to the vulnerability of the real economy. At the end of February, the outbreak of the U.S.-Iran conflict and Iran’s closure of the Strait of Hormuz caused a significant global energy market shock, which suddenly dampened risk appetite. As a result of rising energy prices and increasing geopolitical uncertainty, Hungarian bond yields rose substantially: the 10-year yield rose from 6.4% at the beginning of the month to 7.5% by the second half of the month.
Due to rising inflation expectations, the market began to price in interest rate hikes, which also pushed up the short end of the yield curve. At the same time, the ÁKK curtailed DKJ issuances, resulting in a significant yield spread between discount treasury bills and government securities with remaining maturities of less than one year. In March, the MAX index fell by 3.57%, while the RMAX index rose by 0.08%. The forint exchange rate also came under significant pressure: following an initially moderate weakening, it temporarily reached the 400 level against the euro. The weakening was exacerbated by investor position-closing due to the conflict in Iran, as well as uncertainty surrounding the elections. On March 24, the Monetary Council left the base rate unchanged at 6.25%, emphasizing rising inflation risks and deteriorating growth prospects. By the end of the month, both the bond market and the forint had partially recovered.
US and European government bond markets
On February 28, the United States and Israel carried out coordinated airstrikes against Iran, primarily targeting Iranian nuclear, missile, and military command infrastructure. During the attacks, several key figures in the Iranian leadership were eliminated, including Ayatollah Ali Khamenei. In response, Iran launched missile and drone attacks against Israeli targets as well as U.S. military bases in the region, while mobilizing its regional allies, including Hezbollah and Houthi forces. The new Iranian leadership subsequently took control of the Strait of Hormuz, partially or completely closing it to the United States and its allies, causing significant disruptions to the global energy supply and international trade. The onset of the conflict was marked by a classic “flight to safety” reaction, with investors seeking refuge in U.S. Treasuries. Following the closure of the Strait of Hormuz, however, the focus quickly shifted to the inflationary shock expected in the wake of surging oil and gas prices. As a result, rising yields became widespread in the United States and other developed markets throughout March.
In the United States, the market priced out previously expected interest rate cuts, while in the eurozone, it priced in nearly three interest rate hikes of 25 basis points each by the end of the year. The Fed and the European Central Bank left their key interest rates unchanged, though several ECB policymakers indicated that they could be ready to tighten policy as early as April if necessary.
Monthly report on stock markets
2026. March
Domestic and Central-Eastern European stock markets
In March, the CETOP index, which tracks the Central and Eastern European equity market as a whole, fell by 4.7%. While this represents a moderate correction, it was still the weakest monthly performance since the spring of 2023. Nevertheless, the region performed relatively well compared to developed markets: the German DAX index fell by more than 10%.
At the country level, measured in local currency, the Romanian BET index proved to be the most resilient, with a decline of just 1.2%. The Polish WIG20 index fell by 2.9%, the Hungarian BUX by 4.1%, the Czech PX by 5.4%, while the Austrian ATX—including dividends—fell by 6%. Rising oil and gas prices negatively impacted regional economies primarily through inflation and deteriorating growth prospects, which was also reflected in the weak performance of bank stocks. Based on preliminary March inflation data, inflation accelerated to 3% in Poland and 2% in the Czech Republic, causing expectations of interest rate cuts to be replaced by expectations of rate hikes.
Global emerging stock markets
March was dominated by the conflict in Iran. Following the U.S.-Israeli attack, Iran closed the Strait of Hormuz, triggering a race against time: would traffic on this shipping route - vital to the global economy - be restored before commodity shortages posed the risk of a global recession? Capital market movements were primarily shaped by these developments, as well as the oil and gas exposure of individual regions. In a risk-averse environment marked by rising oil prices, the dollar strengthened, while the U.S. stock market outperformed European and emerging market indices. The MSCI Emerging Markets Index fell by 13.1% in dollar terms, but due to the dollar’s strength, the decline was “only” 8.2% when measured in forint. Among emerging markets, the Brazilian market, which benefited from rising oil prices, proved to be the most resilient (+3.5%). The Mexican (-3.2%) and Turkish (-3.1%) markets also saw more moderate declines, while the previously overbought South Korean (-21.3%) and South African (-15.1%) stock markets - vulnerable due to lower metal prices - were the biggest losers of the month.
Developed stock markets
Sentiment in the U.S. stock market has recently been shaped by the escalation of the conflict in the Middle East and the resulting energy market shock. Rising oil prices and risks related to LNG supply have amplified inflation fears, leading to a correction in the S&P 500 and increased volatility, following the pattern seen during previous geopolitical shocks. In the short term, the impact of rising energy costs on earnings remains manageable, but a prolonged shock could significantly worsen growth and profit outlooks. Corporate earnings growth remains largely tied to AI investments, primarily through the technology and semiconductor sectors, while the productivity effects of AI are only gradually materializing. Inflation may rise above 3% again in the short term due to energy and transportation costs, while core inflation has remained more moderate, providing room for the Fed’s wait-and-see strategy. Overall, the U.S. economy continues to show a stable picture, consistent with a growth trajectory of roughly 2.5% based on current data.
Monthly report on commodity markets
2026. March
Global commodity markets
The near-total paralysis of maritime traffic through the Strait of Hormuz affected nearly one-fifth of global oil and gas
trade, while forcing several Middle Eastern producers to cut output. Although G7 countries sought to alleviate the situation
by releasing strategic reserves, utilizing alternative shipping routes, and capitalizing on a moderation in Asian demand,
the impact of these measures was only temporary. Extreme volatility emerged in the oil and gas markets: prices for oil products
showed even greater fluctuations than crude oil due to refinery shutdowns, while European natural gas prices were driven up
by the shutdown of a key LNG facility.
The war initially supported precious metals, but the subsequent decline in gold called into question its role as a safe-haven
asset. Surging energy prices fueled inflation fears, while the Fed’s hawkish communication and the strong dollar put pressure
on precious and industrial metals. Aluminum was an exception, as supply disruptions supported prices. Agricultural commodity
prices rose, particularly wheat, due to high energy and fertilizer costs, as well as the drought in the U.S.
We would like to draw the attention of our esteemed readers and interested parties to the fact that this information contains data that was current and available on the date of its preparation, and does not constitute investment advice.
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