As the world watched the intensifying conflict between the United States and Iran in early March 2026, global financial markets displayed a remarkable resilience—at least for the moment. Despite the geopolitical turmoil, the three major US stock indices posted gains, and cryptocurrencies soared, even as oil prices and defense stocks spiked in response to the escalating violence. Meanwhile, experts and investors across Asia, especially in South Korea, braced for the complex ripple effects of the crisis, with many wondering just how long markets could defy gravity in the face of such uncertainty.
According to CNBC, on March 2, 2026 (US time), the Dow Jones Industrial Average was up 0.06% at 49,009.25, the tech-heavy Nasdaq Composite rose 0.54% to 22,790.08, and the S&P 500 climbed 0.26% to 6,896.98 during intraday trading. These gains came even as the US military campaign against Iran entered its third day, with airstrikes carried out by both the US and Israel and Iranian retaliation against neighboring Middle Eastern countries. The market’s performance, described by CNBC as “relatively strong despite the US-Iran war escalation,” surprised many observers who might have expected a sharp sell-off in the face of open conflict.
Cryptocurrency markets, often seen as a barometer of risk appetite, were even more exuberant. Bitcoin prices surged 5.41% to $68,855.94, Ether jumped 6.16% to $2,037.60, and Solana soared 6.68% to $87.61. The VANECK BITCOIN TRUST, a major bitcoin ETF, climbed 4.85% to 19.45. Shares of cryptocurrency-related firms such as Coinbase Global (+4.47%), Strategy (+6.18%), and Robinhood (+3.78%) also posted significant gains. CNBC highlighted that “cryptocurrency prices are soaring during the trading session,” reflecting a broader investor enthusiasm for digital assets even as traditional markets faced headwinds.
Energy and defense stocks were another bright spot. The price of US West Texas Intermediate (WTI) crude oil for April delivery jumped 5.88% to $70.96 per barrel, driven by fears of a potential blockade of the Strait of Hormuz—a vital artery for 30% of the world’s oil and 20% of its LNG exports. Shares of major oil companies, including ExxonMobil (+1.10%), Chevron (+1.14%), and ConocoPhillips (+3.21%), rose sharply. Meanwhile, Lockheed Martin, a leading defense contractor, saw its stock price increase by 2.61% as investors anticipated increased demand for military hardware.
Yet, beneath the surface of these market moves lay deep anxieties about the wider consequences of the conflict. In a March 2, 2026 interview on KBS1 Radio’s “Success Forecast,” Prism Investment Advisory CEO Hong Chun-wook discussed the far-reaching implications of the US-Iran hostilities for the Korean stock market and the global economy. He noted that the US and Israeli airstrikes on Iran—timed strategically over the weekend when markets were closed—were likely intended to minimize immediate financial fallout and allow authorities to stabilize the situation before trading resumed.
The political context of the strikes was not lost on market observers. Hong pointed out that President Trump, facing falling approval ratings and a high-stakes midterm election later in the year, appeared to be taking a “political gamble” by escalating military action. “He’s very aware that his approval rating is tied to the stock market,” Hong remarked, suggesting that the timing and messaging around the strikes were as much about domestic politics as foreign policy. The interview also described the military operation as a “decapitation operation”—a targeted attempt to remove Iran’s leadership, following the recent death of Supreme Leader Khamenei and the announcement of a 40-day national mourning period in Iran.
But the risks of such a strategy are profound. Hong warned that without a deep understanding of Iran’s complex ethnic and religious makeup, and without a clear plan for what comes after regime change, the country could descend into a protracted civil war reminiscent of Afghanistan or Iraq. “The possibility of establishing a pro-Western democracy in Iran is less than 30%,” he cautioned, emphasizing the likelihood of a drawn-out conflict with severe humanitarian consequences. Recent history offers sobering precedents: the 2022-2023 hijab protests in Iran saw thousands of young women targeted and killed, and the brutal suppression of dissent remains fresh in the national consciousness.
The potential for regional instability is heightened by the threat of a blockade in the Strait of Hormuz, which could send oil prices skyrocketing and disrupt global supply chains. Hong explained that even the mere risk of attacks on civilian shipping could prompt shipowners to reroute vessels, driving up logistics costs and fueling inflation worldwide. “There’s really no alternative route,” he noted, underscoring the vulnerability of global energy markets to events in the Gulf.
Meanwhile, financial markets in Asia were not immune to the turmoil. Japanese stocks fell 1-2% before paring losses, and US futures indices swung between gains and losses as traders digested the latest developments. In Korea, the stock market was closed for a holiday, but investors were keenly aware of the risks. Prior to the outbreak of hostilities, foreign investors had already been selling Korean stocks in large volumes—a trend attributed to portfolio rebalancing and risk management rather than a lack of confidence in the Korean economy. Hong explained that as Korean stocks outperformed and grew to represent a larger share of global indices, investors were compelled to trim their positions to maintain balance. “It’s not because they dislike Korea,” he said, “but because fund managers have strict limits on how much they can allocate to any one market.”
Currency markets also reflected the shifting landscape. The South Korean won strengthened against the dollar, in part due to the stabilization of the Japanese yen after a historic election victory by Japan’s ruling party. Hong noted that Korean investors had accumulated massive overseas assets—over $1.1 trillion in 2025 alone—and that a return of some of this capital to domestic markets could further support the won. Tax incentives for repatriating funds from US stocks to the Korean market were also discussed as a potential catalyst for increased investment at home.
The technological dimension of the conflict did not go unnoticed. Hong mentioned reports of advanced AI and drone technologies being deployed in the US military campaign, as well as rumors of cyber operations targeting Iranian military networks. While these capabilities could, in theory, enable more precise and effective strikes, Hong remained cautious about their transformative impact: “Unless technology has advanced in a truly revolutionary way, the risks of prolonged instability remain.”
Despite the immediate market resilience, Hong and other experts stressed that the real test would come in the weeks and months ahead. Historical examples, such as the post-9/11 and Iraq war periods, showed that initial shocks to financial markets were often followed by recoveries, especially when central banks responded with monetary easing. However, the prospect of a drawn-out conflict, persistent terrorism threats, and chronic high oil prices could weigh heavily on the global economy if the situation deteriorates.
For now, investors are left to navigate a landscape shaped by both hope and fear—hope that the crisis will be contained and markets will adjust, and fear that the worst is yet to come. As Hong concluded, the best scenario would be a rapid transition to a stable, inclusive government in Iran, but the odds remain daunting. The world can only watch and wait as history unfolds in real time.