Mexico, US Markets Rebound on Iran Peace Signals

Mexico's S&P/BMV IPC rose 2.27% on March 31 but closed the month down 3.91%, as the US-Iran war's impact on global energy prices, inflation expectations, and emerging market sentiment continued to weigh on domestic equities despite late-session gains tied to peace signals. Mining, construction, and consumer sectors, reflected in the outperformance of Grupo México, Cemex, and Genomma Lab, remain most exposed to the conflict's volatility, while gold's 10%-plus monthly decline adds pressure on Mexico's commodity export revenues. Near-term market direction hinges on whether a resolution to the Strait of Hormuz disruption materializes, according to analysts.

Global and Mexican financial markets closed March 31 with broad gains after reports that both the United States and Iran signaled openness to ending their ongoing conflict, lifting risk appetite across equities and commodities. The session-end rebound, however, was not enough to offset the month's losses, which ranked among the steepest recorded across asset classes since the conflict entered its fifth week.

Mexican Markets

Mexico's S&P/BMV IPC gained 2.27% to close at 68,610.72 units, while the FTSE BIVA index rose 2.35% to 1,369.78 units, with the majority of stocks within the benchmark closing in positive territory. The advances were broad-based across sectors, reflecting the shift in global risk appetite that followed statements from both sides of the conflict pointing toward a potential de-escalation.

Cemex led the session's winners with a rise of 5.76% to MX$20.55, a move consistent with the cement and construction sector's sensitivity to energy costs and economic sentiment. Grupo México followed with gains of 5.16% to MX$191.92, while Genomma Lab advanced 4.32% to MX$18.12. The outperformance of Grupo México, a major copper and mining conglomerate, also reflected the broader recovery in commodity-linked equities on the day.

For March as a whole, however, the S&P/BMV IPC fell 3.91%, as the cumulative weight of the conflict, inflation concerns and liquidity pressures erased gains built earlier in the year. The monthly loss underscores how directly Mexico's equity market has been affected by the war's impact on global energy prices, inflation expectations, and investor sentiment toward emerging markets.

"For the following sessions, I expect the index to try to consolidate support at 68,500 points, depending entirely on whether peace guarantees in the Iranian Strait of Hormuz materialize," said Laura Torres, Investment Director, IMB Capital Quants. Her comments reflect the degree to which near-term market direction in Mexico remains tied to geopolitical developments rather than domestic economic fundamentals.

Wall Street

The same peace signals drove a parallel recovery in US equity markets, where all three major indexes posted their strongest single-session gains in weeks. The Dow Jones Industrial Average rose 2.49% to 46,341.51 points, the S&P 500 advanced 2.91% to 6,528.52 points, and the Nasdaq Composite gained 3.83% to 21,590.63 points. 

Nine of the 11 S&P 500 sectors closed higher, led by consumer discretionary at +4.46% and information technology at +4.24%. Within the Dow, Caterpillar rose 6.33% and Nvidia gained 5.59%.

The session's catalyst was a Wall Street Journal report about President Trump telling aides he was willing to end military hostilities against Iran even if the Strait of Hormuz remained largely closed, while Iranian President Masoud Pezeshkian said his country was ready to end the war provided there were guarantees it would not resume, and committed to allowing safe passage of allied ships through the Strait. 

Trump said on Truth Social that Washington was "in serious discussions" with Iranian officials but warned that if a deal was not reached soon, US forces would attack electricity plants, oil wells,and Kharg Island. US Secretary of State Marco Rubio said that Washington's objectives would take "weeks, not months" to achieve, while Reuters reported 2,500 US Marines arrived in the Middle East over the weekend.

Despite Tuesday's rally, all three major US indexes recorded significant monthly losses. The Dow Jones fell 5.40% in March, the S&P 500 declined 5.1% and the Nasdaq lost 4.75%, hurt in part by concerns over artificial intelligence sector valuations alongside the broader war-driven uncertainty. The monthly declines reflected the sustained pressure that surging oil prices, inflation fears and shifting Federal Reserve rate expectations have placed on equities since the conflict began.

Gold, Silver: Mixed Performance

Precious metals also recovered while still closing out their worst monthly performances in years. Spot gold rose 3.5% to close at US$4,668.06/oz in New York, while gold futures climbed more than 2% to settle at US$4,678.60, but the metal still fell more than 10% in March, its biggest monthly decline since June 2013 and its worst month since the 2008 global financial crisis, after dropping nearly 25% from its all-time high of US$5,602 reached at the end of January. 

Silver ended March down more than 19%, its worst monthly performance since 2011, despite rising 7.3% on the day to US$75.17/oz. Both metals posted quarterly gains, with gold and silver up more than 7% and 6%, respectively, in the first quarter.

The sell-off reflected a broader shift in investor behavior, with surging oil prices and inflation fears driving capital toward liquidity and higher-yielding assets rather than metals, unwinding leveraged positions built during gold's more than 60% rally in 2025. 

Goldman Sachs said it remains constructive on gold and continues to forecast prices reaching US$5,400/ozt by end-2026, contingent on continued central bank diversification and 50 basis points of Federal Reserve rate cuts. Near-term risks remain skewed to the downside as Strait of Hormuz disruptions keep gold vulnerable, the bank said, while medium-term risks are skewed to the upside if the conflict accelerates diversification away from Western assets.