Guardian Weekly Market Report – Issue 207

Reports of Note Due This Week

With the first full week of March comes a heavy slate of economic data. Traders will focus on global PMIs early in the week, then shift to U.S. labour market figures and productivity data. A Bank of Canada speech and a Federal Reserve Beige Book update provide additional colour on North American growth, while Thursday’s productivity and trade‐price reports preview the state of inflation. The week culminates with Friday’s non‑farm payrolls release and retail sales, which could set the tone for risk appetite.

• Monday:
  10:00 AM – U.S. ISM Manufacturing Index (Feb)
• Tuesday:
  5:00 AM – Eurozone CPI (Feb, flash estimate)
• Wednesday:
  8:15 AM – U.S. ADP Employment Report (Feb)
  8:30 AM – Canada Productivity (Q4)
  10:00 AM – U.S. ISM Non-Manufacturing Index (Feb)
  2:00 PM – U.S. Federal Reserve Beige Book
• Thursday:
  5:00 AM – Eurozone Retail Sales (Jan)
  8:30 AM – U.S. Import & Export Price Indices (Jan)
  8:30 AM – U.S. Nonfarm Productivity (Q4 prelim)
• Friday:
  5:00 AM – Eurozone GDP (Q4 final)
  8:30 AM – U.S. Employment Report (Feb)
  3:00 PM – U.S. Consumer Credit (Jan)

Geopolitics

President Donald Trump announced that Iran’s supreme leader Ayatollah Ali Khamenei was killed after a massive pre-dawn U.S.- and Israel-led assault on Iran, later confirmed by Iranian state media, marking a historic rupture for the Islamic Republic and raising fears of wider regional war. The strikes, part of “Operation Epic Fury,” targeted Iranian air defenses, missile and drone launch sites, military airfields, and Islamic Revolutionary Guard Corps facilities, killing more than 200 people and injuring hundreds, according to Iranian relief officials, while Trump claimed most of Iran’s senior leadership had been eliminated. Iran retaliated with missile barrages against Israel and U.S. bases across the region but signaled interest in de-escalation once the attacks stop, even as its security council vowed a “crushing response.” The United Nations Security Council held an emergency session, with Secretary-General António Guterres warning of uncontrollable escalation, while Trump urged Iranians to seize control of their government and said the bombing would continue until “peace” is achieved, prompting sharp criticism from Democrats over congressional authorization and support from most Republicans.

China has imposed export controls on dual-use items to 20 Japanese entities it says are linked to Japan’s military, escalating economic pressure on Tokyo amid rising political and security tensions. The measures target divisions of major industrial groups, including Mitsubishi Heavy Industries, and restrict access to critical minerals such as rare earths that are essential for vehicles, electronics and weapons systems. Beijing said the move is intended to curb Japan’s “remilitarization,” citing concerns over Tokyo’s expanding defense posture and closer ties with the United States. Japan’s government condemned the restrictions as unacceptable and has demanded their withdrawal. While Japan maintains rare earth stockpiles that may delay immediate disruption, analysts see the action as a strategic use of supply chains to signal China’s opposition to Japan’s defense buildup, including plans to raise military spending to 2% of GDP and revise security policies.

Panama has seized control of the Balboa and Cristobal ports near the Panama Canal after its Supreme Court finalized a ruling canceling long-standing concessions held by a subsidiary of CK Hutchison, escalating a dispute that intersects with broader U.S.–China strategic tensions. CK Hutchison said Panamanian authorities ordered its staff to leave the ports under threat of criminal prosecution and called the takeover unlawful, signaling it may pursue domestic and international legal action. Panama has granted temporary operating licenses of up to 18 months to Maersk at Balboa and Mediterranean Shipping Company at Cristobal to ensure continuity of operations. The move follows pressure from Washington, including statements by Donald Trump, to limit Chinese-linked influence over the canal. President José Raúl Mulino said the action is not an expropriation but a temporary measure while a new concession framework is developed.

Denmark’s Prime Minister Mette Frederiksen has called an early general election for March 24, seeking a fresh mandate as the country grapples with fallout from a prolonged standoff with Donald Trump over U.S. interest in Greenland. Frederiksen appears to be capitalizing on a recent rise in support for her Social Democrats, driven in part by her firm response to Trump’s threats, which included possible tariffs and warnings that a U.S. takeover of Greenland could undermine NATO. While tensions have eased into technical talks on Arctic security, Frederiksen has said the issue is far from resolved and will remain a background theme in the campaign. The election will also focus on Europe’s security amid the war in Ukraine, Denmark’s cost of living, and Frederiksen’s tough immigration stance, as voters decide the future direction of Denmark.

Pakistan has declared “open war” on neighboring Afghanistan after the two countries traded deadly overnight strikes in a sharp escalation of their long-running border conflict. Fighting erupted after the Taliban launched cross-border attacks on military installations in northwest Pakistan, which Islamabad said were based out of Afghan territory; Kabul denies harboring militants. Pakistan responded with air and artillery strikes on targets in Kabul and other Afghan provinces, calling the attacks “unprovoked” and accusing the Taliban of enabling militant groups, including the Pakistani Taliban. Both sides issued conflicting casualty claims, with reports of soldiers and civilians killed on each side, prompting civilians to flee border regions. United Nations Secretary-General António Guterres and regional actors urged restraint, warning the clashes risk fueling wider instability and empowering groups such as ISIS and Al Qaeda.