Hawkish RBA and another TACO moment?
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Why did oil prices plunge and then rebound this morning?
Well, oil prices have been falling, shares have been rising, bonds are recovering. It's almost like the war is almost over. Well, actually that's what President Trump said yesterday. But Israel and Iran don't seem to see it that way. And it looks like as we record this, the optimism in the markets is starting to turn. Plus, an RBA hike as soon as next week. It's more of a possibility, but with all this going on, is that wise? It's Wednesday, the 11th of March, 2026. It's the morning. call from Nav. Good morning. Well, a big drop in oil prices today. Brent was down sixteen percent and uh fell to below eighty three a barrel, uh, but it's on the move now, it's back up to eighty nine. WTI, which had fallen below seventy eight a barrel, is now back up to eighty five.
So a turnaround is happening as we record this, and shares are higher in Europe and the United States. In fact, the Eurostocks fifty closed up two point seven percent, two point four percent for the DAX over three. In Spain, whereas the moves have been smaller in the United States, 0.7% for the Nasdaq, 0.6% for the SP, but um that's where they were. Those gains have now effectively been wiped out uh in the last half hour or so. And the dollar is down 0.4% this morning. The Aussie, well, it was up 1.1%, almost to 71.6 US cents, the biggest move by far of any of the major currencies. It's fallen a bit now down to 71.3. Bond yields are much lower in Europe, down nine basis points for 10-year guilds, for example, but up for uh for 10-year treasuries.
Aussie 10 years were down nine basis points yesterday to 4.84%. They are up for basis points now this morning on futures.
How did President Trump’s comments on the Israel‑Iran conflict spark market optimism?
Uh so why this massive turnaround? Well, let's talk to NAB Sky Masters. I mean, you'd look at the price action, uh, and until the last Half hour or so assumed that the war was over. But far from it. Even though President Trump told CNN yesterday, and I think this had a bit of a market response, that the war was very complete. Well, pretty much, he said, it won't end this week, but pretty soon. Um we he said we could call it tremendous success right now and not go any further. But he is going to go further. Uh so it seems like the markets took him at his word and assumed that, you know, the This is a short term dispute, and they started pricing in a return to normal.
Yeah, good morning, Phil. Um it is um quite confusing when you you look when I woke up and looked at market price action this morning. So we will try and unpack it and make some some sense of it. But um, you know, I think as you've alluded to at the start, things are things are moving again um or have been in the last half an hour. Um so we'll talk about what happened overnight and then we'll talk about what's happening in the in the last half hour. Um but yeah, you know, initially um sort of clear clear risk on price action um for for most of last night's session. Um, you know, strong As you said, you've seen a strong rally in in um in bond markets, more so in in European and um and and the UK markets, but that's sort of I think a bit of catch up in terms of what happened through the Asian Asian session.
Um massive moves lower in in oil prices and massive, massive um night for corporate bond issuance. So um I'm sort of reading reports that um you know we note that the corporate bond market was sort of shut over the last couple of sessions given given the uncertainty so maybe a bit of bit of catch up here um but in in the US overnight you've had a total of sixty five point seven five billion of investment grade primary issuance coming from eleven eleven issuers um and this is this is the single biggest um largest day of offering on record.
What drove the historic U.S. corporate bond issuance and why was it needed?
So so mass massive um issuance there, led by Amazon who was doing a thirty seven billion deal. So yeah, um, you know, pretty much a a good a good risk on risk on session. But as I said, I think things are things are a moving in the in the last half an hour. But what I guess what's been driving that that sentiment, you know, as you said, it was Trump's comments that I think came in in the latter part of um
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Chapters
8 chapters
1
Why did oil prices plunge and then rebound this morning?
0:01–1:37
2
How did President Trump’s comments on the Israel‑Iran conflict spark market optimism?
1:37–3:50
3
What drove the historic U.S. corporate bond issuance and why was it needed?
3:50–5:53
4
Is the RBA likely to hike rates next week and what are the hawkish signals?
5:53–7:59
5
How are capacity constraints and rising costs affecting Australian business confidence?
7:59–10:36
6
What does China’s surprisingly strong February trade data mean for global markets?
10:36–12:35
7
Why were the latest U.S. Treasury three‑year bond auctions so soft?
12:35–14:24
8
Will the U.S. February CPI move markets or will Middle‑East events dominate?
14:24–16:04