Markets in a state of shock between Easter and the truce: the real signal is not a rebound, but fragility.

Over the Easter weekend and the first three trading days of the week, markets exhibited a near-suspended behavior, as if for a few days they had stopped making economic forecasts and were limited to calculating just one thing: the likelihood of the crisis between the United States and Iran escalating further. On Friday, April 3, Wall Street remained closed for Good Friday, while on Monday, April 6, several European markets, including London, were still closed for Easter Monday. In between, data was scarce, trading was lower than usual, and the market was forced to navigate almost exclusively by geopolitical headlines, ultimatums, and diplomatic rumors.

The common thread these past few days has been Donald Trump, who has continued to ratchet up the pressure on Tehran, linking the suspension of new attacks to the reopening of the Strait of Hormuz. It's not a technical passage: approximately 20% of global oil and gas flows pass through it, and this figure alone explains why the market has reacted so violently to every word coming from Washington. On Tuesday, April 7, the prevailing sentiment was still that of a worst-case scenario: high oil prices, more stubborn inflation, growth under pressure, and central banks forced to remain rigid for longer than expected. At that time, investors weren't just buying or selling an asset, but the price of a potential global energy escalation.

Diplomacy, however, has not disappeared. Indeed, it has returned to the forefront just when it seemed too late. According to Reuters, talks had almost collapsed entirely, and Iran had initially offered strong resistance to the truce proposal, while an attack on a Saudi petrochemical plant threatened to collapse even the last remaining negotiating table. During that transition, Pakistan was the true, decisive mediator, with Prime Minister Shehbaz Sharif and the military leaders committed to maintaining a direct line to Washington, Tehran, and regional actors. Europe, on the other hand, played a more political and diplomatic role: supporting de-escalation, encouraging the truce to be consolidated, and pushing for the safe reopening of sea routes. This is no small feat, but the difference is clear: Islamabad sought to prevent the negotiations from collapsing, while Brussels sought to make them more credible.

Meanwhile, while stock markets waited, the real economy was already absorbing the blow. The European Commission noted that 8.5% of the EU's imported LNG, 7% of its oil, and a whopping 40% of jet fuel and diesel pass through Hormuz. The problem was immediately evident in Italy: between April 2 and 9, four airports—Milan Linate, Venice, Treviso, and Bologna—had to manage limited jet fuel supplies, which were later compensated with alternative supplies. And this was not an isolated case. In Slovakia, extraordinary measures on diesel remain in place, with limits on sales at service stations and other precautions against shortages. When we talk about the energy crisis, therefore, we're not just talking about Brent or WTI, but logistics, inventories, flights, pump prices, and daily supplies.

Then came Wednesday, April 8, and with it the classic relief. The truce announced today produced a sharp rebound because the market had come very close to pricing in a more serious disaster. The STOXX 600 rose 3.7%, the DAX 4.7%, the CAC 40 4.5%, and the FTSE 100 2.5%. On Wall Street, the Dow Jones gained 2.82%, the S&P 500 2.58%, and the Nasdaq 3.05%. On the energy front, the movement was even more violent: Brent fell 12.42% to $95.70, while WTI lost 15.01%, falling back to $96. The message is intuitive: less risk on Hormuz means less pressure on fuel, inflation, and rates. But it would be a mistake to interpret this rebound as a return to normality.

The reason is simple: the April 8 truce was already fragile on the day it was signed. Reuters is talking about a two-week agreement, not a structural solution. Tehran has agreed to participate in the talks, but continues to move with extreme caution and distrust, a sign that the initial refusal has not truly been overcome, but merely frozen. Energy markets also remain far from full normalization: according to Reuters, approximately 130 million barrels of crude oil and 46 million barrels of refined products remain blocked in the Gulf, while even in a more relaxed scenario, global supply could remain 3-5 million barrels per day lower than pre-war levels. In short, the market today celebrated the reduction of immediate risk, not the end of the problem.

Adding to the interesting picture is the most important macroeconomic data of recent days, which arrived almost unnoticed: the US ISM non-manufacturing index. In March, the index fell to 54.0 from 56.1, remaining above the 50 threshold but showing a clear cooling. The details, however, are even more revealing: Business Activity at 53.9, New Orders at 60.6, Employment contracting to 45.2, and Prices at 70.7, the highest since October 2022. In other words: demand is holding up, but employment is slowing and costs are accelerating. It's an uncomfortable combination, because it depicts an economy that isn't collapsing but risks becoming more inflationary just as confidence is becoming more fragile. This is why, behind today's rebound, the markets' message remains cautious: the truce has averted the worst, but it hasn't eliminated either geopolitical or macroeconomic risk.