60-Day War Review: Has Global Capital Markets' Pricing of "War" Really Changed?

Original Author: Frank, MSX Maitong

It has been two months since the US-Israel joint strike on Iran.

Right at the start of February 28th, Iran's Supreme Leader Khamenei was assassinated, and the Strait of Hormuz was suddenly shut down. Based on decades of market intuition, this seemed like a straightforward trading formula: War breaks out, oil prices rise, safe-haven sentiment increases, gold surges, and tech stocks come under pressure.

However, the capital markets of 2026 delivered a far more complex and counter-intuitive result:

Gold didn't continue its upward trajectory following traditional safe-haven logic; instead, it pulled back significantly from its January high. The Nasdaq ETF, which started the year with positive returns, first fell into negative territory, then quickly recovered on ceasefire expectations. The clear outperformer wasn't gold, nor copper, but US energy assets, which are far from the Middle East conflict zone and boast stable production capacity and cash flow.

More paradoxically, throughout this period, the script on the battlefield—hot war, ceasefire, strait blockade, negotiation deadlock—kept being rewritten, and the script for capital markets followed suit, turning page after page.

Looking back at this 60-day conflict, it has forced markets to realize that war acts as a pricing chain, transmitting shocks through energy supply, inflation expectations, interest rate paths, US dollar strength, and asset valuations. The old formula "war = buy gold" has broken down, and the global capital market's logic for pricing 'war' is being fundamentally rewritten.

1. 60 Days, Three Phases

Let's first establish the timeline.

Looking back, this conflict can be roughly divided into three phases:

• Hot War Shock (Feb 28 – Early Apr): After the US-Israel strike on Iran, Iran retaliated with missiles and drones against Israel and US-linked targets. Passage through the Strait of Hormuz was disrupted, sending global energy markets into a state of high alert. This led to rapidly rising oil prices, a revaluation of energy stocks, while gold actually plunged about 20% from its early January high of nearly $5,600.
• Ceasefire Negotiations (Early Apr – Apr 21): As regional mediation efforts progressed, expectations for a ceasefire between the US and Iran and the reopening of the Strait emerged. Risk assets began to recover. The Nasdaq ETF (QQQ.M) rebounded quickly from its lows. During this phase, markets were pricing the "possibility that the worst-case scenario might not happen," but the Strait didn't truly resume stable transit. Events like the US blockade, Iranian seizure of merchant ships, and the breakdown of talks continued to recur.
• Stalemate and Reversal (Apr 22 – Present): Trump announced an extension of the ceasefire, but the US naval blockade and Iranian seizures of commercial vessels occurred simultaneously. The situation remained in a state of suspended animation—"neither war nor peace." Markets gradually recovered from panic. The Nasdaq rebounded from a year-to-date low of -8.4% to +8.21%. Oil prices fell from above $110, but the Strait of Hormuz had not yet truly reopened.

It was through the tug-of-war in these three phases that markets gradually understood they could no longer simply trade on the single variable of "war starts" or "war ends." Instead, the core of pricing became how war changes energy, inflation, interest rates, and the dollar.

As of April 26, the performance of core asset classes tells the story:

More noteworthy is the ranking among these assets. 60 days ago, markets showed extreme divergence: Energy stocks surged, gold plummeted, and the Nasdaq turned negative. Now, while most assets have returned to positive territory (especially QQQ.M), the ranking remains unchanged—energy stocks are still the strongest performing asset class of this conflict.

This further indicates that the market's pricing of this war is not a binary choice between "safe-haven vs. risk," but rather a transmission chain starting from the energy supply shock, flowing through "oil prices -> inflation -> interest rates -> USD -> valuations."

2. Why the Old Formula "War = Buy Gold" Failed

To understand the "counter-intuitive" nature of this 60-day market, one must dissect this transmission chain.

After all, the most counter-intuitive aspect of this market move was gold.

War breaks out, the Strait is blockaded, oil prices skyrocket—gold should be the most direct safe-haven choice. Yet, in reality, gold did not accelerate its rise in the early stages of the conflict. Instead, it fell significantly from its January high. On the surface, this looks like a "safe-haven malfunction," but if we examine the macro transmission chain, we find that gold's performance was actually pricing in the other side of war: stronger tightening expectations.

• The first link comes from oil prices: The disruption in the Strait of Hormuz sharply increased uncertainty for crude oil and LNG transport. Rising energy prices quickly transitioned from a geopolitical premium to an inflationary pressure. For markets, this meant the Fed couldn't easily pivot to easing and might need to maintain a high-interest-rate environment for longer.
• The second link comes from interest rates and the dollar: Higher real interest rates increase the opportunity cost of holding gold. A stronger dollar makes dollar-denominated gold more expensive for non-US buyers. Reuters reporting on gold trends in late April also noted that rising oil prices boosted inflation and interest rate expectations, subsequently pressuring gold through the dollar yield channel.
• The third link is the backlash from crowded trades: Before the war broke out, gold had already experienced an extreme rally, surging from under $3,000 in early 2025 to near its January 2026 high. When a trade becomes overly crowded and a sudden shock hits, funds may not add to positions and might instead choose to lock in profits first. For some short-to-medium-term money, war wasn't a new reason to buy; it was a window to cash out.

This is why the old formula "War = Buy Gold" proved too simplistic in this market. Gold remains a safe-haven asset, but it isn't priced in a vacuum. As long as war drives up energy prices, inflation expectations, and real interest rates, gold will face a tug-of-war between safe-haven demand and tightening pressures.

In other words, gold didn't ignore the war. It was simply reacting to its economic consequences.

In contrast, the Nasdaq ETF's trajectory looked more like a high-volatility stress test. After the war erupted, QQQ.M fell from positive year-to-date returns to negative territory. Tech stocks experienced significant capital outflows, with high-valuation growth assets giving way to sectors with more certain energy, value, and cash flow.

However, when expectations for a ceasefire emerged, the Nasdaq quickly recovered, with its year-to-date return turning positive again. The logic behind this rebound isn't mysterious: expectations of a ceasefire led to a retreat in oil prices from their highs, a marginal easing of inflation pressure, and markets began re-pricing the possibility of rate cuts, giving growth stock valuations room to recover.

The problem is that every link in this chain is not yet fully confirmed. The Strait of Hormuz hasn't resumed stable transit. Negotiations are still seesawing. Oil prices remain in a high range. The foundation for a Fed pivot is not solid.

Therefore, the Nasdaq ETF's rebound looks more like a "risk appetite recovery" than a complete resolution of macro pressure.

3. Gold Fell. Who Were the Biggest Winners?

The answer: energy stocks.

In this market environment, what investors were truly willing to pay a premium for was not an abstract sense of security, but verifiable, deliverable energy supply capacity located far from the conflict zone. Think US energy giants with stable production, more controllable transport routes, and more certain cash flow, located far from the Middle East conflict epicenter.

This explains why OXY.M, XOM.M, and CVX.M significantly outperformed gold and Nasdaq ETF tokens. The market's safe-haven logic shifted from the old "buy gold" to "buy certainty of supply," from "hide in non-yielding assets" to "hold cash-flow assets that benefit from supply shortages."

This is one of the most noteworthy changes brought about by the 2026 war. Geopolitical risks certainly haven't disappeared, but how capital markets react to them has clearly changed. The old linear reflex—"war breaks out, risk rises, buy gold"—is being replaced by a more complex transmission framework: Markets no longer just trade the event of war. They are dissecting how war will impact energy supply, the inflation path, interest rate expectations, dollar strength, and profit distribution across the industry chain, ultimately repricing the risk-reward profiles of different assets.

For investors, the key is no longer just judging "will the war escalate?" but determining which transmission chain the conflict will impact and which tools to use for expressing that view. Choices must be more refined than ever:

• If one judges the conflict will remain in stalemate, Strait passage uncertain, and oil prices high, then energy stock tokens like OXY.M, XOM.M, and CVX.M might be more direct tools, as they trade the revaluation of "secure supply" and "energy cash flow."
• If one judges a true ceasefire will materialize, the Strait gradually reopens, easing oil price pressure and allowing markets to reprice rate cut expectations, then previously pressured tech growth assets might continue to recover. Tokens like the QQQ.M Nasdaq ETF would be better suited to capture the rebound in risk appetite.
• If one judges that pressure on the dollar and real interest rates is easing, the precious metal attributes of gold and silver might regain pricing room. The GLD.M Gold ETF token and the SIVR.M Silver ETF token could regain elasticity. Silver, in particular, has strong industrial properties linked to demand from solar energy, electronics, and AI hardware, potentially offering higher upside elasticity than gold.
• If one judges that global manufacturing, energy transition, grid upgrades, and AI data center expansion are still the longer-term themes, then the CPER.M Copper ETF token acts more like a medium-to-long-term structural tool. Although copper prices are volatile in the short term due to the dollar, demand, and inventory, from a longer perspective, it remains one of the most important metals in the global infrastructure repricing process.

It's worth noting from a trading structure perspective that for investors looking to participate in commodity markets, ETF tokens offer the advantage of being suitable for phased position building and management. Compared to directly trading futures or spot contracts, they avoid the complexities of delivery, rollover, and margin management, making them more appropriate for expressing short-to-medium-term swings or long-term strategic allocations.

For the Nasdaq ETF token, market divergence is equally clear.

If an investor believes oil prices will stay high, inflation remains sticky, and the interest rate environment will continue to suppress growth stock valuations, then shorting QQQ.M, or hedging via the triple-short Nasdaq ETF token SQQQ.M, might be a more direct risk management method.

If an investor judges that subsequent data like payrolls or inflation will weaken, and the Fed will release new easing signals, allowing the tech sector to extend its oversold rebound, then going long QQQ.M, or using the triple-long Nasdaq ETF token TQQQ.M to express a higher elasticity recovery expectation, is also a viable path.

So, the key point is not to provide one single correct direction.

Markets have never automatically gravitated towards a specific asset just because of the word "war." What truly matters is whether investors can decompose their macro judgment into tradable asset paths. For example, is it trading energy supply, or trading lower interest rates? Is it betting on a precious metals recovery, or a tech stock rebound? Is it longing the certain cash flow within volatility, or hedging the downside risk of high-valuation assets?

After all, in this new market environment, determining the direction is only the first step. More importantly, once you form a judgment, can you use efficient, flexible, and low-barrier tools to translate that judgment into an executable trading strategy?

Final Thoughts

If, 60 days ago, someone had told you:

• The US and Israel airstrike Iran, its Supreme Leader is killed, the Strait of Hormuz closes, but gold falls 16%;
• Tech stocks fall 8% first, then rally back 8%, forming a V-shape over two months;
• Almost no one dared to heavily weight energy at the start of the year, but OXY would rise nearly 40%;
• The YTD return for the Nasdaq and Gold would be almost identical (+8.21% vs +9.32%), while OXY would achieve 4 times that;

You probably wouldn't have believed it.

But this is the market of 2026. Old logic hasn't completely failed, but it's no longer sufficient. Through this 60-day crucible of conflict, the market has learned not to simply condition itself to the keyword "war." Instead, it dissects the economic transmission channels of war, assesses the credibility of ceasefires, and dynamically prices stalemates.

What we can do is not to predict the next answer, but to ensure we have the right tools when the answer arrives.

In the global investment market under Trump's governance, any possibility is real. What we can do is not to predict the next answer, but to ensure we have sufficiently appropriate tools as the answers gradually emerge.

The ability to efficiently turn judgment into trade is the true dividing line.