ASX 200 Live Today - Monday, 12th October

Welcome to our live ASX coverage for Monday, October 12. Expect a high volume of posts pre-market and more periodic updates throughout the day. We'll be wrapping the blog up around 2:00 pm AEST. Let us know how we can make it even better.

Goldman flags upside risk to oil as risk premium nears record

[8:54 am] Goldman Sachs sees upside risk to its Brent forecast if geopolitics keeps the oil risk premium elevated for longer, after updating its price model to capture very low inventories outside the OECD.

• Risk premium of US$22/bbl in September, the second highest monthly reading on record after April 2026

• Premium outlook assumes a gradual return to the historical average of zero, though it may stay elevated until there is a clear diplomatic resolution

• Premium drivers include supply disruption fears and portfolio hedging, as disruptions lift inflation and Treasury yields and weigh on bonds and equities

• Global visible stocks are near their lowest since at least 2017, keeping Brent above $100 despite a recovery in Persian Gulf exports

• Model update adds global stocks outside OECD commercial storage, after the Brent timespread rose US$30/bbl YTD while OECD commercial stocks barely moved

Tanker squeeze replaces crude shortage as oil’s key pressure point: JPMorgan

[8:53 am] JPMorgan says October’s oil market looks a lot like April’s, but the problem has shifted from a shortage of crude to the cost of moving it.

• Delivered crude prices are back at spring highs, with European refinery margins turning negative again and the risk of run cuts rising

• Hormuz flows jumped to 12mbd in September from around 7.5mbd in July and August

• VLCC fleet stretched with 766 of 923 in active use by September, while 124 Iranian VLCCs (13% of the fleet) are largely unavailable due to US sanctions

• Longer voyages from ship-to-ship transfers taking up to 10 days and rerouting around higher-risk areas mean each tanker completes fewer trips

• Middle East crude (ex-Iran) now needs an extra 35 VLCCs, 13 Suezmaxes and 10 Aframaxes vs the 2025 average, with VLCC employment elsewhere down 16 vessels

• Smaller tankers are filling the gap outside the Middle East, with Aframax employment up 141 vessels (23%) and Suezmax up 52 (11%) vs the 2025 average

Oil holds above US$100 as Middle East attacks offset Trump’s strike pause

[8:50 am] Escalating attacks on shipping and Saudi Arabia kept Brent anchored above US$100 a barrel, outweighing Trump’s pledge not to strike Iran before the US midterms.

• Brent up 0.4% to US$104.29 on Friday after jumping ~3% on Thursday

• Trump pledge not to attack Iran before the 3 November midterms, citing “productive discussions”. Iran is reviewing a US response to its proposal to reopen Hormuz within seven days

• Putin relayed Tehran’s vision for ending the war to Trump after meeting Iranian President Pezeshkian, according to the Kremlin

• Missile capacity preserved, according to Western officials, who say Iran’s factories are replenishing arsenals with Russia also supplying missiles. The White House rejected the assessment

• Tanker attacks hit at least 10 vessels in the past week, with tanker hire costs at about $1.2m a day vs less than $50,000 before the war

• Houthis strike Riyadh airport on Saturday, killing at least 12, wounding more than 300 and cancelling 600+ flights, with fresh strikes on Sunday

• US weighs joining Saudi strikes on the Houthis, with Trump saying “We may”, after rejecting two Saudi requests last month

• Dated Brent topped $135 on Thursday, the highest since April, though Aramco will supply European refiners all the November crude they requested after allocating none last month

Russia to resume diesel exports under Trump-Putin deal

[8:49 am] Russia will partially lift its diesel export ban after Trump struck a supply deal with Putin aimed at easing record US fuel prices ahead of the midterms.

• Supply schedule of more than 300,000 tons immediately, 500,000 tons in November and 1m tons thereafter, followed by another 3m tons depending on refinery conditions, according to Trump

• Export ban eased with Russia allowing 500,000 tons of exports from Saturday, partially reversing curbs in place since January

• Sanctions waived on Russian diesel by the US Treasury through April 2027

• US diesel above US$6 a gallon for the first time, with heating oil futures falling as much as 5% in post-settlement trade on the news

• Zelenskyy condemned the deal, saying “Gifts to Putin will not bring peace or any benefit to the civilized world”

• Hurricane Isaias shut in about 72% of Gulf of Mexico crude output, with nearly 500,000 bpd of refining capacity in its path

RBI ramps up rupee defence as currency nears record low

[8:49 am] The Reserve Bank of India unveiled its strongest currency support measures since the 2013 taper tantrum, days after hiking rates, with analysts viewing 97 per US dollar as its line in the sand.

• FX risk reserve requires lenders to hold 20% of the notional value of each derivative trade above $2m with the RBI, mirroring a PBOC tool

• Dollar window opened for state-owned oil refiners, while the limit on derivatives without an underlying exposure was cut to $5m from $100m

• Rupee down 7% YTD, the worst performer in Asia, closing Friday just above its 96.965 record low

• Reserves drained by $51bn in four weeks, after a record $133bn diaspora deposit drive lifted reserves to nearly $800bn

• Foreign outflows from Indian equities top $30bn this year, with ANZ’s Dhiraj Nim saying “oil prices and capital flows will still decide the rupee’s direction”

Source: Bloomberg

Nvidia in talks to deepen Reflection AI ties

[8:47 am] Nvidia is in early talks to boost its investment in open-weight model developer Reflection AI or supply it with computing power.

• Deal options reported by the FT include an acqui-hire, a chip supply deal or a bigger equity stake, potentially leading to an acquisition offer. No terms have been reached

• Beam model Reflection’s first open-weight model launched this month, scoring comparably to China’s Z.AI GLM-5.2 on reasoning benchmarks

• Reflection valuation talks to raise $2.5bn at $25bn (WSJ), alongside billion-dollar compute deals with SpaceX and Nebius

• Nvidia dealmaking follows its $13bn Hugging Face acquisition in September and a roughly $20bn licensing pact with Groq

Source: Bloomberg

History favours more S&P 500 gains as bull market turns four

[8:46 am] The US bull market turns four today and strategists say history points to further upside into year-end.

• Truist’s Keith Lerner says it is the seventh of 11 bull markets since the 1950s to reach four years, with its 119% gain below the 184% average

• Fifth-year returns averaged 12% with a median of 15% among bull markets that reached this stage

• Midterm seasonality The S&P 500 has risen in 21 of the last 23 midterm cycles from one month before to two months after the vote, with a 7% median return (Deutsche Bank)

• Exceptions in 1978 and 2018 were both driven by rising rates, but Deutsche’s Jim Reid notes neither had a blockbuster earnings season about to begin

• Q3 earnings growth of 29.5% expected for the S&P 500, which would be a third straight quarter above 25%

• Semis and hardware account for about 40% of YTD upgrades to 2026 S&P 500 earnings estimates and 75% for 2027 (Barclays)

Source: Yahoo Finance

OpenAI eyes $70bn revenue run-rate after report rattles chip stocks

[8:45 am] OpenAI has told investors it expects annualised revenue to reach at least $70bn by year-end, easing concerns sparked by a report its sales were running well short of estimates.

• Annualised revenue was about $50bn at the end of September, with growth driven largely by enterprise

• Measurement gap The FT reported the shortfall came from investors applying Anthropic’s method, which accounts for cloud provider sales differently

• Chipmakers sold off on Thursday’s report, with a gauge of chip giants down 3.4% and the Nasdaq 100 down 1.4%

• Anthropic hit $65bn in annualised revenue by end of July and could IPO as soon as November, while OpenAI has pushed its listing to at least next year

• Fundraising talks for $30bn or more at a $1.4tn pre-money valuation, after raising $122bn in March at an $852bn post-money valuation

US telcos sink as SpaceX buys spectrum for Starlink Mobile push

[8:44 am] America’s big three carriers tumbled after SpaceX agreed to buy low-band spectrum it says paves the way for Starlink Mobile to become a major US carrier. SpaceX shares rose 1.3%.

• Grain Management portfolio of up to 14 MHz of paired 800 MHz spectrum, subject to FCC approval

• Carriers hit with T-Mobile down ~13%, AT&T ~10% and Verizon ~9%, while Crown Castle rose ~12%, American Tower ~8% and SBA ~6% on hopes of tower buildouts

• Evercore ISI said “The carriers’ best argument just got weaker” but called it “more of a coverage fix than a capacity solution”

• Spectrum gap Even including EchoStar’s 65 MHz, SpaceX would hold about 79 MHz vs 280 to 380 MHz each for the big three

• TD Cowen said SpaceX still likely wants an MVNO first and “could be bluffing”

• Timeline Next-gen mobile satellites start flying in 2027 with 5G-quality service from 1H28, after the FCC approved 15,000 Gen2 Starlink Mobile satellites this week

Delta slashes FY26 guidance as fuel bill soars

[8:43 am] Delta Air Lines missed ests for the first time in two years as a $6 billion increase in full-year fuel costs swamped strong premium demand. Shares closed flat.

• Adjusted revenue up 16% to $17.58bn vs $17.76bn ests (1% miss)

• Adjusted EPS of $1.72 vs $1.82 ests (5% miss)

• Premium revenue up 18% to $6.82bn, outpacing 12% growth in main cabin revenue to $6.8bn

• Fuel bill up 62% to $4.1bn, including $500m above July guidance

• FY26 adjusted EPS guidance cut to $5.10 to $5.60 from $6.50 to $7.50, with the midpoint down 24%. Q4 guidance also came in below ests

• Free cash flow guidance cut to $2.5bn from $3bn to $4bn

• Q4 revenue forecast to rise 20% year-on-year, with CEO Ed Bastian saying “The consumer response continues to be quite strong”

Good morning!

[8:25 am] ASX 200 futures are up 37 pts (+0.42%). Here's what happened overnight:

• Wall Street capped a volatile week higher, with tech rebounding from Thursday's AI wobble and the S&P 500 finishing within reach of a record ahead of bank earnings

  • S&P 500 (+0.59%), within 0.09% of the 6-Oct record

  • Nasdaq (+0.64%), Dow (+0.83%), Russell 2000 (+0.46%)

  • US weekly recap – S&P 500 (+1.15%), Nasdaq (+0.64%), Dow (+0.93%), Russell 2000 (-0.91%)

• Trump's diesel deal with Putin waived Russian sanctions through April 2027, and Moscow partially lifted its export ban over the weekend

• Middle East risks flared over the weekend after a Houthi strike killed 12 at Riyadh's airport, while Bloomberg reported Russia is supplying Iran with missiles