Fidelity strategist sees 1 buying opportunity in resilient markets

Markets are pricing in a swift resolution to the Iran conflict, with strong corporate earnings providing a buffer against a wider selloff, according to Fidelity’s director of global macro Jurrien Timmer.

"Markets, broadly speaking, are 'pricing in some form of resolution' to the current geopolitical tensions, particularly around Iran, 'sooner rather than later'," Timmer said in an interview with CoinDesk.

The view is supported by oil’s futures curve remaining in backwardation despite spot prices surging over $100 a barrel. Meanwhile, the S&P 500 has recovered from a 9 percent drop to just a 1 percent drawdown, showing resilience that was absent during last year's 21 percent tariff-related selloff.

While a prolonged disruption in the Strait of Hormuz, which handles 20 percent of global oil, could trigger a stagflationary shock, Timmer sees the current volatility as an opportunity for disciplined long-term investors.

Oil Backwardation Signals Short-Term Shock

Timmer noted that while crude prices surged, the futures curve remains in backwardation, with contracts for later delivery trading roughly $40 below the front month. This structure signals that investors view the supply disruption as a short-term issue rather than a prolonged crisis. The market’s reaction to a two-week ceasefire announcement, which saw oil plunge more than 17 percent before recovering, reinforces this view of temporary volatility.

Bitcoin Forms a $65,000 Base

In the crypto market, Timmer sees signs of a bottom forming. After a 50 to 60 percent decline from its peak of $126,000 last October, he believes the "paper hands" have been flushed out. Selling pressure has been absorbed, and the $65,000 level is now acting as solid technical support. While a catalyst is needed for the next move higher, the world's largest cryptocurrency was trading in the low $70,000s, suggesting a potential base.

Timmer believes equities are effectively priced for success, with only single-digit drawdowns despite the geopolitical uncertainty. The primary reason, he argues, is the strength of corporate earnings and a constructive backdrop of a mid-cycle economic expansion. Still, he highlights concentration risk in "Magnificent Seven" technology stocks and interest rate risk, with the 10-year Treasury yield approaching 4.5 percent, as key areas for investors to monitor.

Ultimately, Timmer frames the volatility not as a challenge but as an opportunity. He encourages investors to act as providers of liquidity when others are retreating, noting that disciplined investors with long-term perspectives can become price makers.

This article is for informational purposes only and does not constitute investment advice.