ASX 200 Live Today - Thursday, 12th March

Welcome to our live ASX coverage for Thursday, March 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.

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New updates

ASX 200 dips, trading at session lows

[2:39 pm] It's getting pretty grim, with the S&P/ASX 200 down 1.59%, trading around worst levels and set to close around Monday, 9 March lows. The index is now back below the key 200-day moving average and the Aussie 10-year yield is edging ever so closer to a five handle (currently 4.96%). Breadth remains very weak, with just 25 constituents trading higher (12.5%). WTI crude is currently pushing intraday highs, up 7.3% to US$94.9 a barrel – a clear sign that the emergency SPR release is not enough. As RBA rate hike expectations climb from two hikes to three, and Fed rate cut expectations fall to just one cut, we're entering a rough patch where there isn't a positive headline in sight. The Index is looking rather oversold, but failing to hold the recent low is not a good sign.

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RBA set for back-to-back rate hikes

[2:06 pm] Bloomberg Economics now expects the RBA to hike at its 17 March meeting, with the Iran-driven energy shock and a misleadingly tight labour market forcing the central bank's hand.

• TD Securities expects a back-to-back hike in the RBA's March and May meetings, bringing rates to 4.35%

• A 60 bps drop in labour force participation over the past year has artificially suppressed the unemployment rate, which Bloomberg Economics estimates would sit closer to 5%

• Consumer inflation expectations rose to 5.2% in March, the highest since July 2023, up from 3.6% a year ago, reinforcing the case for tighter policy

• Money markets are pricing a ~75% chance of a hike next week following hawkish signals from the RBA's deputy governor and Governor Michele Bullock flagging the meeting as "live"

Source: Bloomberg

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Hedge funds pile into Aussie dollar calls

[2:04 pm] Macro hedge funds are aggressively building bullish Australian dollar positions in options markets, with call volume surging to six times that of puts ahead of an expected RBA rate hike on 17 March.

• AUD/USD call option volume hit six times that of puts on Wednesday, with block trades of $150m or larger showing the same 6:1 ratio, reflecting broad-based conviction from macro funds, fast-money accounts and European investors

• Three of Australia's Big Four banks are forecasting a 25 bp RBA rate hike on 17 March, with hawkish commentary from Deputy Governor Andrew Hauser on 10 March, flagging inflation remains too high and that Middle East-driven price pressures add further upside risk

• The Aussie has rallied ~7% against the USD year-to-date and more than 4% versus the kiwi, touching its strongest level since June 2022 at 71.87 US cents this week, supported by carry trade appeal from relatively high Australian front-end rates

Source: Bloomberg

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Middle East conflict drives UBS to lift near-term aluminium and thermal coal price forecasts

[12:26 pm] UBS has revised up near-term commodity price forecasts for aluminium and thermal coal, flagging elevated supply disruption risk from the Middle East conflict while leaving medium-term forecasts unchanged pending de-escalation.

• UBS lifts its 2026 LME aluminium forecast by 13% to ~$3,250/t, with Middle East supply disruptions accelerating expected market tightness; the 2027 forecast of ~$3,300/t is left unchanged, implying conflict de-escalation and normalisation of energy costs

• Middle East producers supply ~25% of aluminium imports into Europe and the US, meaning protracted Strait of Hormuz restrictions risk further smelter closures and tighter regional premiums, compounding the already-announced closure of 575kt at Mozal

• UBS cuts its 2026 alumina forecast by 5% to ~$320/t, as reduced smelter demand from the Middle East risks flooding the already-oversupplied spot market, though Chinese refinery cuts could limit the downside

• 2026 thermal coal (NEWC) forecast lifted 10% to $126/t, supported by gas-to-coal substitution dynamics as European gas prices have surged 42% since the conflict began on 28 February, with NEWC up ~14% over the same period

• UBS's preferred Australian exposures are South32 (S32, Buy, $5.20 price target) and Alumina Ltd (AAI, Neutral, $95 price target)

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ASX 200 sharply lower

[12:22 pm] ASX 200 down 1.30% at noon and just ~0.3% away from the Monday close. Every sector is trading lower except Energy, with heavy selling across yield-sensitive sectors like Tech, Real Estate and Financials. Breadth is rather abysmal, with 178 constituents (89%) lower. The Aussie 10-year was up 8.5 bps overnight to 4.95%, and flat in today's session. These levels represent the highest since October 2023 and on the cusp of breaking out to the highest since 2011. Some economists (Westpac and NAB) are now forecast three back-to-back RBA hikes.

ASX 200 sectors (Source: Market Index)

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Analysts' take on Lynas

[12:15 pm] Lynas renewed its offtake agreement with Japan Australia Rare Earths (JARE) on Wednesday, securing a firm commitment for 5,000 tonnes of NdPr per annum at a market-linked floor price of US$110/kg. The stock rallied 16.2% on the news.

• Bell Potter upgraded to Hold from Sell, raised target from $11.60 to $19.00. The deal provided revenue and earnings certainty with floor pricing offering downside protection, though the view remained cautious despite improved contract quality.

• UBS maintained Buy, raised target from $17.70 to $23.90. The agreement was seen as reinforcing a separate ex-China market, with the magnet strategy and heavy rare earth exposure viewed as major strategic opportunities with further Western deals expected to follow.

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Analysts' take on Ora Banda

[12:14 pm] A larger-than-expected mineral resource upgrade at Round Dam has materially bolstered Ora Banda's Davyhurst asset, improving long-term ore supply visibility and supporting the case for a standalone processing plant.

The newly defined open-pit inventory is seen as capable of providing consistent base-load feed for a proposed standalone processing plant at Davyhurst, with higher-grade underground sources across the district viewed as a complementary production stream.

The stock rallied 21.4% on Wednesday, and up another 4.2% at the time of writing.

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WTI update: Prices shrug off SPR release

[11:32 am] WTI crude is currently up 5.6% to US$93 a barrel. This follows another volatile overnight session, where prices finished 2.3% higher, off session lows of -5.3%.

• The IEA announced a record 400 million barrel emergency reserve release, surpassing even the post-Ukraine invasion drawdown, though traders remain cautious given lack of clarity on US participation

• Analysts estimate the reserve release provides roughly one month of cushion against the ~15-20 million barrels per day of Persian Gulf supply currently offline

• Iran has threatened to not let a "litre of oil" to pass the Strait of Hormuz, tells the world to get ready for oil at US$200 a barrel

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Energy stocks edge higher

[10:57 am] Energy stocks are up 1.31% today after crude oil jumped back above US$90 overnight, as the Iran war raises persistent concerns over oil supply, outweighing the coordinated release of oil reserves by major economies.

By Stephanie Gardner

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Soaring yields drive real estate stocks lower

[10:48 am] Real estate stocks are trading sharply lower today, down 2.55%, after Australia's 10-year government bond yields reached their highest level since 2011 at 4.90%.

By Stephanie Gardner

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Tech stocks sharply lower

[10:41 am] The tech index is down 3.47% today, but is still tracking marginally higher this week, up 0.86%.

By Stephanie Gardner

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Top ASX 200 gainers and losers

[10:33 am] Here are today's top gainers and losers on the ASX 200.

By Stephanie Gardner

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Air New Zealand suspends FY26 guidance

[9:57 am] Air New Zealand has pulled its earnings guidance after jet fuel prices more than doubled following the escalation of conflict in the Middle East, materially threatening its second-half result.

• Jet fuel prices have surged from US$85-90 prior to the conflict to US$150-200 per barrel in recent days, rendering the fuel price assumption underpinning February guidance no longer appropriate

• The crack spread, the refinery margin component of jet fuel pricing, has been particularly volatile, widening from ~US$22 per barrel before the conflict to as high as US$115 per barrel

• Air New Zealand is 83% hedged against Brent crude for 2H26

• But remains fully exposed to crack spread movements, with estimated fuel consumption of ~2.9 million barrels remaining for the March-June period, leaving significant unhedged cost exposure

Company page: Air New Zealand (AIZ)

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Collins Foods accelerates German expansion, reaffirms FY26 guidance

[9:50 am] Collins Foods has signed a binding agreement to acquire eight KFC restaurants in Bavaria while expanding its German development pipeline, as the business continues to deliver improving sales momentum across its network.

• Acquiring eight KFC restaurants in Bavaria from JJ Restaurant GmbH & Co. for ~€31.1m plus working capital, representing a near 50% increase in its German portfolio, with completion expected May-June 2026

• Anticipated revenues of ~€28.2m and restaurant-level pre-AASB16 EBITDA of ~€5.3m in the first 12 months post-completion, with the deal expected to be immediately EPS accretive

• German Development Agreements expanded to target 45-90 new restaurant openings across Bavaria, Baden-Württemberg and North Rhine-Westphalia over four years

• Trading momentum is positive, with 2H26 to date total sales up 6.2% in Australia, 9.1% in Germany and 4.1% in the Netherlands year-on-year, with same-store sales growth of 3.2%, 4.1% and -0.3% respectively

• FY26 guidance reaffirmed for mid-to-high teens growth in Group Underlying NPAT

Company page: Collins Foods (CKF)

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Bond yields start to hit uncomfortable levels

[9:28 am] Bond yields are starting to push levels that start to pressure equity markets. The US 2-year yield, a barometer for short-term interest rate expectations, has surged 27 bps since late February to the highest since September 2025.

US 2-year bond yield (Source: TradingView)

The Aussie 10-year yield has also jumped 31 bps over the same time period to the highest since October 2023 (this was also the month where global equity markets bottomed after ~2 years of underperformance amid central bank rate hikes and high inflation).

Australia 10-year bond yield (Source: TradingView)

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US February CPI in line, but Iran war clouds the outlook

[9:19 am] Inflation data came in as expected for February, though economists warn the figures are already a rearview mirror snapshot ahead of Iran war-driven energy price shocks.

• Headline CPI up 0.3% month-on-month and 2.4% year-on-year, in line with ests

• Core CPI up 0.2% month-on-month and 2.5% year-on-year, both in line with ests

• Early signs of tariff pass-through are visible, with apparel up 1.3% month-on-month (highest since October 2021) and appliances up 3.1% month-on-month (largest on record)

• Shelter inflation continues to cool, with rent of primary residence rising just 0.1% month-on-month, the lowest since January 2021, providing some offset to goods price pressures

• The February PCE reading is tracking at a core monthly pace of at least 0.4%, a level inconsistent with the Fed's 2% annual target, even before Iran war effects flow through

• Economists caution the data is effectively stale, with oil and energy prices surging since the Iran conflict began, pointing to upward pressure on both headline and core CPI in the months ahead

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JPMorgan moves to cut private credit exposure

[9:11 am] JPMorgan is marking down the value of software loans held as collateral by private credit clients, signalling growing unease about the sector's vulnerability to AI disruption.

• JPMorgan's trading division has reduced the assessed value of loans, mostly to software firms, held as collateral within private credit clients' financing portfolios, limiting their ability to borrow against those assets and in some cases forcing additional collateral calls

• The move targets "back-leverage," where private credit firms borrow against their loan books to amplify returns, a structure that layers leverage on leverage and can accelerate losses when underlying loans deteriorate

• The markdowns are preemptive and driven by market valuation changes rather than actual loan losses, with the bank framing it as financial discipline consistent with Jamie Dimon's longstanding focus on credit risk management

Source: CNBC

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Oracle beats on earnings, lifts FY27 guidance as AI infrastructure demand surges

[9:11 am] Strong cloud growth and a raised revenue outlook helped Oracle shares rally 9%, though the stock is still down ~50% from its September 2025 record high.

• Revenue up 22% to $17.19bn vs. $16.91bn ests (2% beat)

• Adjusted EPS of $1.79 vs. $1.70 ests (5% beat)

• Cloud infrastructure revenue up 84% to $4.9bn and accelerating from 68% growth last quarter, reflecting surging AI workload demand

• Total cloud revenue up 44% to $8.9bn, up 44%

• FY27 revenue guidance raised by $1bn to $90bn, well above the $86.6bn ests

• Remaining performance obligations more than quadrupled to $553bn (vs. $556bn ests), with management noting most large AI contracts are pre-funded by customers, limiting incremental capital needs

• Oracle plans to raise $45-50bn this fiscal year to expand capacity, targeting over 10 gigawatts of compute power over the next three years, though negative free cash flow of $13.18bn over the past 12 months remains a key investor concern

Oracle price chart (Source: TradingView)

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Qatar's LNG mega-plant goes dark, threatening global supply

[9:06 am] Ras Laffan, the world's largest LNG export facility, has halted shipments for five days following an Iranian drone attack, raising the prospect of a significant tightening in global gas markets.

• No LNG tanker has left Ras Laffan for five days, the longest such streak in data going back to 2008, after an Iranian drone attack prompted the facility to halt output following the onset of US and Israeli strikes on Iran

• The plant supplies roughly 20% of global LNG, meaning an extended outage carries material consequences for gas prices in both Europe and Asia, where prices have already jumped in response

• Most of Qatar's supply flows to Asian importers, who are now scrambling for alternative sources or cutting deliveries to end-users such as fertiliser plants and industrial customers

Source: Bloomberg

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Oil prices shrug off SPR release

[9:04 am] WTI finished the overnight session 2.3% higher to US$88.40 a barrel, clawing back earlier declines of 5.3%.

WTI daily price chart (Source: TradingView)

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IEA unleashes record oil reserve release

[8:58 am] Emergency stockpile release fails to cool oil prices as Strait of Hormuz supply risks overshadow the intervention.

• The IEA coordinated its largest-ever emergency reserve release, with member countries drawing down more than 360 million barrels (double the previous record of 182 million barrels released following Russia's Ukraine invasion in 2022)

• Despite the scale of the release, crude prices held firm and even gained on the session

• At least 14 commercial vessels have been struck since the conflict began, with reports of Iran potentially mining the Strait of Hormuz, a chokepoint carrying roughly 20 million barrels per day of seaborne petroleum products

• IEA member countries hold approximately 1.2 billion barrels in government reserves plus ~600 million barrels in mandatory commercial inventories, providing a theoretical buffer, but market confidence in its effectiveness appears limited

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Goldman Sachs says hedge fund positioning sets up equities for a sharp squeeze higher

[8:57 am] Goldman Sachs's trading desk says extreme macro hedging by hedge funds has created asymmetric upside risk for US equities if geopolitical tensions ease.

• Hedge funds have piled into bearish hedges via ETFs and index futures, with short exposure at its highest level since September 2022

• Gross exposure among hedge funds is near an all-time high at 307%, meaning any positive headline could trigger aggressive short-covering, with Goldman estimating a 2-3% straight-line rally at the index level if a conflict resolution is announced

• Fundamental long-short hedge funds lost around 4% of year-to-date performance last week amid sharp sector rotations, while long-only managers have largely moved to the sidelines awaiting macro clarity

• Corporate buybacks are providing a floor for equities, with Goldman's buyback desk recording one of its busiest weeks for share repurchases in three years

• Goldman warns that if geopolitical uncertainty extends beyond two weeks with no progress, equities face a more meaningful selloff at the index level

Source: Bloomberg

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Pimco's commodity fund hammered by Iran war

[8:56 am] Pimco's Commodity Alpha Fund has been smashed by the outbreak of war in Iran, with losses accelerating sharply in March.

• The fund is down ~17% in March alone, extending year-to-date losses to ~26%, following a ~9% decline last year

• The fund managed ~$3bn before March's drawdown, meaning losses this month represent roughly $500m in value destruction

• Jet fuel trading was a key driver of March losses, with Singapore jet fuel prices surging more than 70% following the outbreak of war before easing slightly

• Pimco is not alone, with Balyasny, Millennium and Coatue also suffering declines, though oil-specialist Pierre Andurand notably made money last week, highlighting how positioning and conviction shaped outcomes

Source: Bloomberg

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US stocks choppy

[8:50 am] A fairly uneventful overnight session, where US indices showed limited movements in both directions. S&P 500 (-0.08%) and Nasdaq (+0.08%) outperformed the Dow (-0.61%) amid strength from Tech and Energy stocks. While defensives and yield-sensitive sectors like Staples (-1.29%), Real Estate (-1.12%), Financials (-0.83%) and Utilities (-0.81%) underperformed.

S&P 500 intraday chart (Source: TradingView)

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Good morning!

[8:34 am] ASX 200 futures are down 47 pts (-0.54%) as of 8:30 am AEDT.

The overnight session in a nutshell:

• Major US benchmarks mostly lower, indices traded in a relatively narrow range, showing limited upside and downside (S&P 500 finished 0.08% lower, vs session highs of 0.44% and lows of -0.53%)

• Bond yields are soaring, with the US 2-year yield up 6 bps to the highest since September 2025, Aussie 10-year up 8 bps to 4.96%, the highest since October 2023 and on the cusp of fresh 15 year highs

• G7 agrees to release a combined 400 million barrels of oil from the Strategic Petroleum Reserve, WTI still closes the overnight session up 2.3% (despite falling as much as 5.3%)