Goldman Sachs CEO: Markets May Need Two Weeks to Absorb Impact of War on Iran

Sydney | EcoPulse24

David Solomon, CEO of Goldman Sachs, voiced his surprise at the relative calm shown by global financial markets in response to the escalating war in the Middle East, cautioning that the true impact is yet to be fully absorbed.

Solomon made his remarks on the sidelines of the Australian Financial Review Business Summit in Sydney on Wednesday, March 4, 2026. He stated, "I look at the market's reaction and am genuinely surprised by how much calmer it is than it should be, given the scale of events."

He explained that markets have historically tended to react mutedly to geopolitical events unless there is a direct and tangible impact on economic growth. "There is a cumulative effect to everything happening that could lead to a harsher reaction, but so far we haven't seen that cumulative impact. Forecasting is extremely difficult amid so many unknowns," he added.

Solomon concluded, "I think it will take about two weeks for markets to truly digest the implications of what has happened, whether in the short or medium term."

Risk repricing is now a reality, he said, noting, "The one certainty that always occurs in such events is that investors demand higher risk premiums for their assets, and that's exactly what we're seeing now."

Solomon's comments come on the fifth day of the conflict, amid a turbulent financial scene:
- Dubai Financial Market (DFM): Closed at 6,197.19 points, down 306.31 points or 4.71%, with trading value at AED 896,327,460.58 over 8,418 transactions.
- Abu Dhabi Securities Exchange (ADX): The FADX index closed at 10,251.58 points, down 202.30 points or 1.935%, with trading value at AED 962,916,919.29 across 24,327 trades involving 281,511,933 shares.
- Oil: Brent crude prices rose about 1.6% to $82.76 per barrel, nearing their highest levels since January 2025, amid growing concerns over shipping disruptions through the Strait of Hormuz.
- US Stocks: Notable volatility has been observed since the outbreak of hostilities, with indicators pointing to a lower open on Wednesday.
- Aviation: Qatar Airways announced the temporary suspension of flights due to Qatari airspace closure, directly impacting the regional aviation sector.

On the military front, the Israeli army announced its tenth wave of airstrikes on Tehran, targeting what it called "the infrastructure of the Iranian terror regime in the capital." Iran's Supreme Leader Ayatollah Ali Khamenei was killed in a joint US-Israeli strike over the past weekend, with preparations underway for a three-day mourning ceremony.

The ongoing escalation places global central banks in a complex position, as fears of an oil shock and renewed inflationary pressures complicate monetary policy decisions aimed at supporting economic growth.

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