MPC Morning Call 11th March 2026 — Markets Whipsaw as mis-information creates Hormuz Confusion
Crude oil plunged more than 10% in its biggest one-day fall since 2022 as hopes of a Middle East de-escalation briefly gripped markets, before mixed messaging from the White House sent energy prices on a wild ride. Asian and European equities rallied sharply, but Wall Street…
Watch on YOUTUBE MPC Morning Call 11th March 2026 — Oil Crashes, Markets Whipsaw as Hormuz Confusion Reigns Crude oil plunged more than 10% in its biggest one-day fall since 2022 as hopes of a Middle East de-escalation briefly gripped markets, before mixed messaging from the White House sent energy prices on a wild ride. Asian and European equities rallied sharply, but Wall Street lagged with the S&P 500 slipping 0.2%. The US dollar weakened as safe-haven demand eased, while the Australian dollar surged to a three-year high after hawkish RBA commentary raised the odds of another rate hike next week. Oil Volatility Reaches Extreme Levels Amid Strait of Hormuz Uncertainty Oil markets experienced one of their most turbulent sessions in years as crude traded in an extraordinary intraday range. WTI briefly dipped below $77 a barrel after US Energy Secretary Chris Wright posted — then deleted — a claim that the US Navy had escorted a tanker through the Strait of Hormuz. The White House subsequently confirmed no such escort had taken place. Prices rebounded sharply after CBS and CNN reported that US intelligence had detected signs Iran may be laying mines in the strait. WTI ultimately settled near $86.73, down 8.5% on the day. The G7 has asked the International Energy Agency to prepare scenarios for the release of emergency oil reserves, underscoring the severity of the supply disruption. With the strait effectively closed and Gulf producers slashing output, the geopolitical risk premium in energy markets remains elevated. Leveraged positions are particularly exposed, and reports of significant hedge fund losses would not be surprising given the scale of recent price swings. Wall Street Lags Global Rally as Conflicting Signals Cloud Outlook In a rare divergence, US equities posted mild losses while Asian and European markets surged. South Korea's benchmark rallied 6%, and European indices rose as much as 3%, buoyed by hopes of de-escalation. However, the S&P 500 slipped 0.2% to 6,782.43 and the Nasdaq was essentially flat, with only communication services and technology sectors finishing in the green. Energy stocks fell 1.3%. After the bell, Oracle delivered a strong beat, with cloud infrastructure revenue jumping 84% and the company projecting $90 billion in fiscal year 2027 revenue, sending shares up roughly 7% in extended trading. In corporate debt markets, Amazon launched a $37 billion bond offering, Salesforce announced plans to raise up to $25 billion for share buybacks, and Honeywell Aerospace kicked off a $16 billion inaugural bond sale — a flurry of issuance adding pressure to Treasuries. The 10-year yield rose 5 basis points to 4.15% following a soft $58 billion auction. China's Export Machine Accelerates as Trade Surplus Swells China's exports surged 22% in the first two months of 2026, more than three times the pace of growth in December and well above consensus forecasts. The January–February trade surplus hit $213 billion, as shipments to the rest of the world boomed even as tariffs crimped US-bound trade. Last year's record $1.2 trillion surplus, which revived complaints about China's currency regime, could be broken this year at the current pace. In contrast, German exports in January shrank at their fastest rate since May 2024, highlighting the diverging fortunes of the world's major exporting nations. RBA Hawkish Turn Lifts the Aussie Dollar to Three-Year High The Australian dollar surged to US71.70¢, its highest level in over three years, after Reserve Bank of Australia Deputy Governor Andrew Hauser warned that failing to act decisively on inflation could lead to "toxic" outcomes. Money markets are now pricing a 62% chance of a rate hike at the March 17 meeting, up from 39% prior to the comments, with a third hike this year fully priced by August, which would take the cash rate to 4.35%. The three-year bond yield rose to 4.49% and the 10-year benchmark added 5 basis points to 4.88%. The Aussie was the top G10 performer overnight. Commodities, Energy & FX ASX Today: Rate Hike Bets Rise as Hawkish RBA Sends Aussie Soaring Overnight moves present a mixed picture for the ASX. The sharp pullback in oil prices could offer some relief to energy-sensitive sectors and consumer-facing stocks exposed to fuel costs, though the ongoing volatility around the Strait of Hormuz keeps risks firmly in play. The hawkish shift from the RBA, with markets now pricing a majority chance of a March rate hike, may weigh on rate-sensitive sectors including REITs and growth stocks. Financial stocks could see some support from steeper yield curves. Oracle's strong after-hours result may provide a tailwind for local technology names with cloud and AI exposure. GQG Partners reported funds under management rising to $242.9 billion despite $3.2 billion in net outflows, while Macquarie Technology secured $200 million from the National Reconstruction Fund to expand sovereign digital infrastructure. Day Ahead There…
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