Author: Deep Tide TechFlow

US Stocks: From a 600 Point Plunge to a Rebound, a Historic V-Shaped Reversal

On Monday, Wall Street staged a textbook-level "war panic - desperate rebound" scenario.

Markets plummeted at the open: the Dow Jones fell by 600 points (-1.2%), the S&P 500 dropped 1.2%, and the Nasdaq declined 1.6%. Investors urgently fled risk assets, pouring into gold, dollars, and government bonds for safety.

But by the close, a miracle happened —

The S&P 500 slightly rose 0.04% to 6,882, the Nasdaq increased 0.36% to 22,749, and the Dow Jones fell just 0.15% (-73 points) to 48,905.

The market flipped from "extreme panic" to "calm buying" in 6 hours.

Who were the driving forces behind this V-shaped reversal?

1. Nvidia and Microsoft led the gains: Nvidia surged 3%, Microsoft climbed 1.5% — Investors flocked to cash-rich, strong-balance-sheet tech giants, betting they could withstand the impacts of war.
2. Defense and energy sectors supported the market: Northrop Grumman jumped 6%, Lockheed Martin rose 3%, and drone manufacturer AeroVironment soared over 10%. Exxon Mobil increased 1.1%, Chevron rose 4%.
3. The historical pattern of "buying during war panic": Wells Fargo data shows that the S&P 500 typically turns to positive within two weeks after significant geopolitical conflicts, averaging a 1% increase after three months.
4. Oil prices fell from 12% to 6-8%: Brent crude briefly surged 12% during trading but closed down to +6% at $77.74 per barrel; WTI crude rose 6.3% to $71.23 per barrel. The narrowing oil price increase alleviated concerns about inflation.

KKM Financial CEO Jeff Kilburg predicted on social media late Sunday night: "The futures market has overreacted to the Iran conflict; the S&P 500 is close to the 2026 low, making it a buying opportunity. We are still in a bull market despite escalating geopolitical tensions."

By Monday's close, his prediction came true.

From a stock perspective, airline stocks plummeted while defense stocks skyrocketed.

Losers: Airline and travel stocks. United Airlines fell 2.9%, Delta Airlines fell 2.2%, American Airlines dropped 4.2%, Air France plummeted 9.4%, and Lufthansa fell 5.2%

The Middle East conflict suddenly cooled business travel and international routes in major cities like Dubai, leaving airlines facing the double whammy of soaring fuel costs and plummeting passenger flows.

Winners: Defense and energy stocks. Northrop Grumman +6%, Lockheed Martin +3%, drone manufacturer AeroVironment +10%, Chevron +4%, ConocoPhillips +5%, tanker stocks Frontline +5%.

Palantir surged to $143.30, up over 4%. As a core provider of military intelligence and AI-driven warfare, geopolitical tensions directly propelled its stock price higher.

Cryptocurrency Market: Bitcoin Strongly Breaks $68,000, Geopolitical Panic Becomes a Buying Signal

On Monday, the cryptocurrency market staged an impressive rebound.

After reaching $68,000 on Sunday, Bitcoin experienced a brief pullback on Monday but quickly regained ground, with a 24-hour increase of 4.92%, finally stabilizing around $66,983.

Ethereum performed even stronger, surging nearly 4% to reclaim the $2,000 mark, completely erasing the losses from the war panic over the weekend.

Solana soared nearly 6%, with mainstream coins like Cardano and BNB generally up between 3-5%.

The total market cap of cryptocurrencies grew by 2.73% within 24 hours, returning to $2.3 trillion — a key signal that investors are viewing cryptocurrencies as "alternative safe-haven assets" rather than merely risk assets.

Why does this geopolitical conflict favor Bitcoin instead?

This rebound broke traditional understanding. In the past, geopolitical crises typically led to Bitcoin plummeting as investors sold off all risk assets for cash and gold.

But March 3 is different. Bitcoin rose almost in tandem with gold, which suggests a structural shift: Bitcoin is evolving from a "pure risk asset" to "digital gold."

Macroeconomist Henrik Zeberg wrote in his March outlook: "The main scenario for Bitcoin is a rebound to $110,000-$120,000, driven by 'risk appetite frenzy', ETF cash inflows, and sustained institutional adoption. A secondary scenario (probability 25%) is that if the cycle is prolonged, Bitcoin could climb to $140,000-$150,000."

Zeberg's prediction for Ethereum is equally aggressive: the ETH/BTC ratio will move towards 10%, placing Ethereum prices between $10,000-$12,000.

CoinCodex predicts: if the current momentum continues, Bitcoin could reach $73,431 by March 6, an increase of 8.38%.

Technical analyst Michael Van De Poppe emphasized: Bitcoin must hold the support level at $65,000. Once held, attacking $70,000 and above is only a matter of time.

Currently, the cryptocurrency market fear and greed index is only at 14 (extreme fear), which is usually the best buying opportunity.

Historical data shows: whenever the fear index falls into the "extreme fear" zone, strong rebounds usually follow in the subsequent weeks.

The extreme pessimism of market sentiment sharply contrasts with the robust rebound in prices. This is a typical characteristic of "smart money" accumulating during panic.

Gold and Silver: Breaking $5,400, Creating Historic Highs

On Monday, gold prices went completely wild.

Spot gold surged 2.6%, breaking the $5,400 per ounce mark, reaching a high of $5,408, creating a historic high. Futures gold even soared above $5,400, reflecting the market's frenzied demand for safe-haven assets.

As of the morning of March 3, gold stabilized at $5,338 per ounce, having increased over 100% from $2,624 per ounce a year ago.

This is not an ordinary safe-haven rebound:

1. Central banks continue to buy gold: In 2025, global central banks recorded record gold purchases, and even as gold prices reached new highs, enthusiasm for buying remained unabated. The World Gold Council forecasts that central bank gold purchases will stay high at 773-1,117 tons in 2026.
2. Weak dollar and "de-dollarization": Although the dollar index briefly strengthened due to safe-haven demand, the long-term trend is weak. Central banks are accelerating diversification of reserves, with gold becoming the preferred choice.
3. Closure of the Strait of Hormuz raises energy crisis concerns: 20% of the world's oil supply passes through the Strait of Hormuz; its closure could drive oil prices above $100 per barrel, further raising inflation expectations, which benefits gold.
4. Geopolitical risk premium: The death of Iran's supreme leader, the closure of the Strait of Hormuz, and increased production by Saudi Arabia and Russia — these factors combined have pushed the "war premium" for gold to historical extremes.

Silver also surged, reaching $95 per ounce, and although it later pulled back to around $94, it maintained a strong upward trend.

Analysts predict: If geopolitical tensions persist, gold could break $6,000 per ounce in the second half of 2026. Institutions like UBS and Bloomberg have already raised their target prices.

Today's Summary: On the Third Day of War, the Market Learned "Contrarian Thinking"

On March 3, the US-Iran war entered its third day, the Strait of Hormuz closed, oil prices soared, the supreme leader of Iran died, and the world entered "epic fury" mode.

But the market's reaction was unexpected: Bitcoin surged 5% past $68,000, gold broke $5,400 to set a historic high, and US stocks rebounded from a 600-point drop to positive closing.

This is a victory of "contrarian thinking":

• Stock market investors: buy during war panic, betting on short-term conflict.
• Cryptocurrency investors: view the geopolitical crisis as a catalyst for accelerating "de-dollarization".
• Gold investors: crazily chase safe-haven assets, pushing gold prices to historic highs.

Legendary investor Steve Eisman stated on CNBC on Monday: "I will not change any trade because of this conflict. In the long run, this is very, very positive."

But warning signals still exist:

1. If oil prices break $100 per barrel, it will trigger uncontrollable inflation.
2. If the conflict lasts longer than "a few weeks," market expectations will be shattered.
3. The Federal Reserve may be forced to maintain high rates for a long time, suppressing valuations of risk assets.

The resilience of the market is astonishing, but this resilience is built on the assumption of a "quick resolution."

If the war drags on, if the Strait of Hormuz remains closed for an extended period, if oil prices really break $100, then today's V-shaped reversal may just be the calm before a bigger storm.

But at least for today, the market proved one thing with action: Panic is often the best buying opportunity.