U.S. Stock Market Preview | "Quadruple Witching" Approaches! U.S. Seeks Multiple Measures to Suppress Oil Prices While Wall Street Warns of Continued Oil Price Surge

Pre-Market Market Trends

1. On Friday, March 20, U.S. stock futures declined across the board. As of press time, Dow futures down 0.31%, S&P 500 futures down 0.32%, Nasdaq futures down 0.45%.

2. As of press time, European markets showed slight gains: Germany DAX up 0.07%, UK FTSE 100 up 0.11%, France CAC 40 up 0.17%, Euro Stoxx 50 up 0.32%.

3. WTI crude oil fell 1.34% to $94.27 per barrel. Brent crude dropped 1.59% to $106.92 per barrel.

Record $5.7 Trillion “Quadruple Witching” Approaching U.S. Stocks!
As Middle East tensions escalate, volatility is on the brink. According to Citigroup data dating back to 1996, approximately $5.7 trillion in notional value of options tied to U.S. equities, indices, and ETFs will expire on Friday—making it the largest March expiration in history. This quarterly event, long called “Quadruple Witching” by traders, is now more accurately described as “Triple Witching.” The notional options include $4.1 trillion in index contracts, $772 billion in ETF contracts, and $875 billion in single-stock options. Quadruple Witching often forces traders to close, roll over, or rebalance large positions, which can trigger sudden and intense asset price swings due to the rapid disappearance of large derivatives exposures. According to Goldman Sachs Prime Book data, current U.S. stock positions are very fragile; declines can be amplified, and bullish moves can be shorted back down.

Trump considers risking seizure of Hark Island to force Iran to reopen the Strait.
According to four sources, the Trump administration is contemplating actions to seize or block Iran’s Hark Island to compel Iran to reopen the Strait of Hormuz. To end the conflict on his terms, Trump needs to break Iran’s control over shipping through the strait. Seizing the island could put U.S. forces directly into combat. Such actions would only be considered after further weakening Iran’s military presence around the strait. “We need about a month of strikes to further weaken Iran, seize the island, then fully subdue them and use this as leverage for negotiations,” one source said. If approved, additional forces would be required.

U.S. issues license related to sanctions on Russian oil.
The U.S. Treasury announced a new general license allowing the delivery and sale of Russian crude oil and petroleum products loaded onto ships before March 12, valid until April 11, 2026. While the main terms are consistent with previous licenses, the Thursday exemption explicitly excludes transactions involving North Korea, Cuba, and Crimea. Easing sanctions on Russian oil is part of the Trump administration’s effort to stabilize energy prices amid Middle East conflicts.

U.S.-Israel signal de-escalation; European natural gas prices spike then retreat.
After attacks on gas fields, Iran retaliated against oil and gas assets across the Middle East. Previously, missile strikes damaged two LNG production lines at Ras Laffan Industrial City in Qatar, with a combined capacity of 12.8 million tons per year—about 17% of Qatar’s LNG exports. Repairs could take up to five years. The attacks pushed oil prices higher and drew condemnation from President Trump. Israel stated it would no longer target energy infrastructure. Following efforts by Israel and the U.S. to ease fears of further attacks on Persian Gulf energy facilities, European natural gas prices fell, with benchmark futures dropping 3% on Friday.

Inflation fears persist; U.S. Treasury yields continue rising.
Hawkish central bank comments and Brent crude holding above $100 per barrel pushed U.S. Treasury yields higher on Friday. The 2-year yield rose 4 basis points to 3.83%, the 5-year yield up 3 basis points to 3.91%. Oil price surges led market participants to lower expectations for Fed rate cuts this year. Before the Iran conflict, swap traders priced in a 61 basis point cut; now, expectations have dropped to just 3 basis points.

After Qatar facility attack, multiple parties seek long-term U.S. LNG contracts.
Following Thursday’s attack on Qatar’s major LNG facility, global supply tightness worsened. Increasingly, buyers and importers are turning to the U.S. for LNG. Sources say companies interested in importing LNG are directly engaging with U.S. fuel suppliers, including producers and long-term contract buyers. These suppliers’ volumes will come from existing and under-construction projects. The U.S. is the world’s largest LNG exporter and plans to expand further. Discussions on U.S. LNG supply are still early, and long-term contract terms will take time to negotiate.

Goldman Sachs warns: Oil prices could stay above $100 long-term, even surpassing 2008 highs.
Goldman Sachs on Thursday stated that risks to oil prices remain skewed to the upside through 2027. Past supply shocks suggest prices could stay above $100 per barrel. As long as the Strait of Hormuz remains restricted, prices could continue rising. If disruptions persist, Brent could exceed 2008’s peak of $147.50.

Bank of America warns: If the Strait of Hormuz remains closed for days, oil could hit $200.
Francisco Blanch, head of commodities and derivatives research at BofA Securities, warned that the Strait must reopen within days, not weeks. Prolonged closure could push global into recession, with Brent and WTI soaring above $200 per barrel. The core logic is a supply-demand mismatch: global GDP growth of 1% typically requires 1% growth in energy supply. Currently, supply shortfalls caused by Iran conflict and strait closure are estimated at 8%.

China manufacturing key! Tesla (TSLA.US) plans $2.9 billion investment in Chinese solar equipment.
Sources say Tesla is seeking to purchase $2.9 billion worth of solar panels and cell manufacturing equipment from Chinese suppliers, including Suzhou Maxwell Technologies. Elon Musk aims to add 100 GW of solar capacity in the U.S. by 2028. In January, Musk claimed solar could meet all U.S. power needs, including growing data center demands. Tesla’s job postings aim for “100 GW of domestic solar manufacturing by the end of 2028,” starting from raw materials.

Geopolitical stability assured; restructuring strategy pays off! FedEx (FDX.US) reports strong earnings and outlook.
As a logistics bellwether, FedEx beat Wall Street expectations for Q3 (ending Feb 28). Adjusted EPS was $5.25, well above the $4.14 forecast; revenue hit $24 billion, surpassing $23.43 billion estimates. Buoyed by strong results, FedEx raised its FY2026 adjusted EPS outlook to $19.30–$20.10, above previous guidance of $17.80–$19.00 and the consensus of $18.69.

Novartis (NVS.US) to spend $3 billion on acquisition of Synnovation Therapeutics’ breast cancer assets.
Novartis agreed to buy Synnovation Therapeutics’ experimental breast cancer drug for up to $3 billion, including a $2 billion upfront and up to $1 billion in milestone payments. The Swiss pharma plans to acquire Pikavation Therapeutics’ pipeline. The deal is expected to close in the first half of this year, pending regulatory approval.

Google (GOOGL.US) secretly begins Mac testing of Gemini AI, competing positively with OpenAI and Anthropic in Apple ecosystem.
Google is developing a dedicated Gemini AI app for Apple Mac, aiming to compete with OpenAI and Anthropic. Alphabet’s Google has started private beta testing this week, gathering user feedback before public release. This move is part of AI companies’ efforts to expand chatbot reach. OpenAI’s ChatGPT and Anthropic’s Claude already have Mac versions.

Key Economic Data and Events

• Early tomorrow at 3:30 AM Beijing time, the CFTC releases the weekly Commitment of Traders report.