Global equity markets extended their slide this week as Day 13 of the war in Iran delivered a fresh shock: two oil tankers struck by projectiles near Iraq's southern ports, renewed Iranian threats to block the Strait of Hormuz entirely, and an unprecedented coordinated release of 400 million barrels of emergency reserves by the International Energy Agency. Despite the emergency intervention, Brent crude briefly reclaimed $100 per barrel on Thursday, underscoring how deeply the market's risk premium is entrenched. The macro picture is becoming sharper with each passing session. The Iran war is no longer a geopolitical event that markets can price and move past. It has become the dominant regime driver for cross-asset allocation globally.

Global Equity Market Overvie

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The week of March 4–11, 2026 produced broad-based selling across country ETFs. The MSCI All Country World Index ETF (ACWI) declined 1.4%, while the iShares MSCI ACWI ex-US ETF (ACWX) fell 1.7%. Developed international markets underperformed, with the iShares Core MSCI EAFE ETF (IDEV) losing 2.4%.

The tone shifted sharply mid-week. Reuters reported on Thursday that "global shares fell as attacks on oil tankers in the Gulf shattered any prospects of an early resolution" to the conflict. Bloomberg noted that stocks "retreated across the world as oil prices kept rising amid widening disruptions to crude transport operations in the Middle East."

U.S. inflation data offered a brief moment of stability. CPI for February came in at 2.4% year-on-year, in line with expectations, providing some relief to rates markets. However, the oil shock is increasingly complicating the Federal Reserve's path forward — any sustained move in crude above $100 per barrel feeds directly into future inflation readings.

Best Performing Country ETFs This Wee

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The energy exporter premium is the week's clearest signal. The iShares MSCI Saudi Arabia ETF (KSA) gained 1.7% and the iShares MSCI Kuwait ETF (KWT) added 1.8% — both direct beneficiaries of elevated crude prices. The iShares MSCI Norway ETF (ENOR) managed a marginal gain of 0.2%, reflecting Norway's position as a major European gas supplier.

Colombia's 4.1% surge stands out. The Global X MSCI Colombia ETF (COLO) is benefiting from a dual tailwind: higher oil prices supporting its energy sector, and improving domestic economic conditions. The iShares MSCI Turkey ETF (TUR) also gained 0.8%, supported by regional trade re-routing dynamics as shipping patterns adjust around Hormuz disruptions.

Worst Performing Country ETFs This Wee

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The iShares MSCI UAE ETF (UAE) leads weekly declines with a 5.8% loss — a striking divergence from Gulf neighbors Kuwait and Saudi Arabia, reflecting direct exposure to regional security risk as drone and missile attacks have targeted UAE infrastructure in recent days. The iShares MSCI Israel ETF (EIS) also declined 4.0% on the week despite its strong year-to-date performance, suggesting some near-term profit-taking as the conflict drags on longer than initially expected.

Emerging market importers bore the heaviest burden. The VanEck Vietnam ETF (VNM) dropped 4.9%, the iShares MSCI Peru ETF (EPU) fell 4.5%, and the iShares MSCI Mexico ETF (EWW) declined 4.1%. Reuters noted that "the rush of cash out of risk assets has rattled emerging markets since war engulfed the Middle East," though some investors view the selloff as an opportunity given structural improvement in these economies.

Key Macro Drivers This Wee

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IEA Emergency Reserve Release: The IEA announced a unanimous approval from member nations to release 400 million barrels of strategic petroleum reserves — the largest coordinated release in history. Despite this intervention, Brent crude briefly reclaimed $100 per barrel on Thursday as Iranian forces struck two tankers near Iraq's Basra terminal. Al Jazeera cited Iranian IRGC statements warning that "not a litre of oil will get through the Strait of Hormuz," threatening a $200 per barrel price scenario.

U.S. CPI In Line, But Oil Complicates The Fed: February CPI printed at 2.4% year-on-year, steady with prior readings. The data provided some temporary relief for rate-sensitive assets, but markets are increasingly focused on the forward path — a sustained oil shock above $100 could push headline inflation materially higher through Q2 2026, limiting the Fed's flexibility to respond to growth slowdowns.

China Tightening Fuel Exports: Bloomberg reported that China tightened fuel export quotas this week in response to domestic energy security concerns raised by the Hormuz disruption. This development removes a potential supply buffer from global refined products markets and adds another inflationary vector to the commodity complex.

Vessel Attacks Widen: NPR reported on Thursday that Iran's strikes are expanding beyond initial targets. Two tankers were hit near Iraq's southern oil export terminals — a direct threat to Iraqi crude flows that represent approximately 4 million barrels per day of global supply. J.P. Morgan has previously warned that any significant disruption to Kharg Island or Iraqi terminal capacity could produce oil price spikes well above current levels.

YTD Performance Scorecard: March 12, 202

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Despite the weekly selloff, the year-to-date rankings tell a story of structural outperformance concentrated in energy exporters, Asian technology markets, and Latin American commodity plays.

Top 5 Country ETFs YT

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Worst 5 Country ETFs YT

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South Korea's iShares MSCI South Korea ETF (EWY) retains its commanding 36.6% year-to-date lead, driven by AI semiconductor demand and KOSPI's historic move above 6,000. Norway's iShares MSCI Norway ETF (ENOR) has extended its advantage to 21.1% on sustained energy price strength.

On the laggard side, the iShares MSCI Indonesia ETF (EIDO) remains the year's worst performer at -13.5%, reflecting a combination of energy import pressure and political uncertainty. The iShares MSCI India ETF (INDA) has pulled back to -8.8% YTD as oil import costs weigh on India's current account.

Valuations Across Market

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The divergence between energy exporters and importers is creating valuation anomalies worth monitoring. While countries like South Korea and Norway trade at premium multiples reflecting strong earnings momentum, energy-import-dependent markets like India and Indonesia are approaching historically attractive valuations after their selloffs.

View our full Valuation Heatmap for a real-time breakdown of P/E ratios, price-to-book and earnings yield across all tracked country ETFs.

Key Takeaway

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• The IEA intervention is a ceiling, not a floor. The 400 million barrel emergency reserve release signals coordinated political will to cap oil prices, but the market's reaction — Brent back above $100 despite the announcement — confirms that supply disruption fears are deeper than any reserve release can fully offset. The conflict's duration matters more than any one policy response.
• Energy exporters remain the clearest relative value. Saudi Arabia (KSA), Kuwait (KWT), Norway (ENOR) and Colombia (COLO) continue to screen as direct beneficiaries of the oil shock. These positions are working both on a weekly and year-to-date basis.
• Emerging market importers face a two-front pressure. Higher oil prices erode trade balances while risk-off sentiment simultaneously drains capital flows. Reuters noted that "emerging markets could endure Middle East shocks," but the near-term path remains difficult for energy-dependent economies.
• The Iran War is the Fed's new variable. In-line U.S. CPI data would normally be neutral-to-positive for risk assets. In the current environment, it merely delays the reckoning — oil above $100 threatens to reignite inflation readings through Q2, limiting the Fed's room to ease in response to any growth slowdown.
• South Korea holds its year-to-date crown. Despite the Iran-driven volatility, EWY's AI-semiconductor structural story remains intact. The weekly -1.1% pullback is modest relative to its 36.6% year-to-date lead, and the underlying KOSPI drivers — technology earnings and domestic monetary support — have not materially changed.

Monitor Global Markets in Real Tim

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Track every country ETF's performance, valuation and correlation using our live tools:

• Global Performance Heatmap — see every market at a glance
• Compare Country ETFs — build custom performance comparisons
• Valuation Tool — screen markets by P/E and price-to-book
• Seasonality Patterns — historical monthly performance data
• Iran War Market Monitor — dedicated crisis tracking

FA

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Which country ETFs are benefiting most from the Iran war?

Energy exporters lead. The iShares MSCI Saudi Arabia ETF (KSA), iShares MSCI Kuwait ETF (KWT), iShares MSCI Norway ETF (ENOR) and Global X MSCI Colombia ETF (COLO) are the clearest weekly and year-to-date beneficiaries of sustained high oil prices.

Why did the UAE ETF fall while Saudi Arabia and Kuwait gained?

The iShares MSCI UAE ETF (UAE) carries direct exposure to regional security risk, with drone and missile strikes targeting UAE infrastructure. Saudi Arabia and Kuwait, while also in the region, have benefited more directly from the fiscal windfall of higher oil revenues.

Will the IEA reserve release stop oil from rising further?

The 400 million barrel release is the largest coordinated intervention in IEA history, but Brent crude still briefly reclaimed $100 post-announcement. Iran's stated intent to block all Hormuz flows, combined with ongoing tanker attacks, means the geopolitical risk premium is running well ahead of any supply-side policy response.

What does U.S. CPI at 2.4% mean for markets?

The in-line reading avoids a negative surprise, but the forward trajectory is what matters. An oil price sustained above $100 will mechanically lift headline inflation readings through Q2 2026, complicating Fed policy and keeping real yields elevated — a headwind for rate-sensitive equity markets globally.

Which markets look most oversold after this week's decline?

Energy importers with strong structural fundamentals — India (INDA), Indonesia (EIDO) and Vietnam (VNM) — have experienced sharp selloffs that may be creating entry opportunities for medium-term investors. Use our Valuation Tool to screen current multiples against historical ranges.