Morning Wrap: ASX 200 to tumble, S&P 500 at four-month lows amid cautious Fed, Oil prices surge

ASX 200 futures are down 149 pts (-1.74%) as of 8:30 am AEDT.

In a nutshell:

• Local sharemarket set to give back Tue-Wed gains and mark fresh year-to-date lows after a downbeat overnight session

• Major US benchmarks sharply lower after hawkish remarks from the Fed, an intensifying Middle East conflict that continues to damage key energy infrastructure and a hotter-than-expected US PPI print

• Brent rallied 6.6% to US$110.4 a barrel, while most commodity prices, including copper, gold and palladium, fell more than 3%

Let's dive in.

Overnight Summary

Thu 19 Mar 26, 8:24am (AEST)

Name	Value	% Chg
Major Indices
S&P 500	6,625	-1.36%
Dow Jones	46,225	-1.63%
NASDAQ Comp	22,152	-1.46%
Russell 2000	2,479	-1.64%
Country Indices
Canada	32,313	-1.87%
China	4,063	+0.32%
Germany	23,502	-0.96%
Hong Kong	26,025	+0.61%
India	76,704	+0.83%
Japan	55,239	+2.87%
United Kingdom	10,305	-0.94%

Name	Value	% Chg
Commodities (USD)
Gold	4,817.94	-3.77%
Copper	5.44	-5.05%
WTI Oil	99.82	+3.76%
Currency
AUD/USD	0.7025	+0.02%
Cryptocurrency
Bitcoin (USD)	71,300	-4.35%
Ethereum (AUD)	3,121	-5.92%
Miscellaneous
US 10 Yr T-bond	4.259	+1.36%
VIX	25.09	+12.16%

S&P 500 SESSION CHART

S&P 500 lower, finished at worst levels (Source: TradingView)

OVERNIGHT MARKETS

• Major US benchmarks sharply lower, selling accelerated into the close after the Fed flagged slower progress on inflation

• Brent shrugged off early weakness to finish the session 6.6% higher to US$110.3 a barrel, the highest close since Jul-22

• Market on the defensive after trading higher for two consecutive sessions, with most indices giving back most if not all of recent gains

• S&P 500 undercut the recent low, now at the lowest since 21-Nov-25

• Iran, PPI data and FOMC were the key downward drivers, with Iran threatening evacuation warnings for Gulf energy sites, hotter-than-expected February PPI and hawkish takeaways from Powell’s press conference

• Bond traders scale back Fed rate cut expectations, with one 25 bp reduction priced in by year-end (BBG)

• Global hedge funds endure worst losses since 'Liberation Day' (CNBC)

• Barclays market indicator giving strongest buy signal for stocks since Liberation Day tariff fallout in April 2025 (BBG)

• Chinese AI stocks tied to OpenClaw surge following Nvidia CEO's positive remarks on AI agents (BBG)

• Stone Ridge Asset Management the latest private credit fund under stress, which has spread to consumer and SMB-linked loans (WSJ)

FED ON HOLD

• Rates held at 3.50-3.75%, with one dissent from Governor Miran who favoured a 25bp cut.

• Fed projections still show 25 bp of cuts through end-2026

• Inflation forecasts revised higher (headline PCE 2.7% vs 2.4% prior, core PCE 2.7% vs 2.5% prior).

• GDP growth nudged up to 2.4% (from 2.3%) while the unemployment outlook held steady at 4.4%.

• Statement changes were minimal, with the addition of language around uncertain implications of the Middle East war

ENERGY

• Trump administration says it will waive Jones Act shipping requirements for 60 days, as expected (NYT)

• Saudi oil exports through Red Sea are projected to reach a record high of 3.8 mbpd in March (OP)

• Two vessels headed for Cuba carrying Russian oil and fuel, defying Trump energy embargo (FT)

• Iraq and Kurdistan agree to resume oil exports via pipeline (RT)

• Reopening Hormuz viewed unlikely without a truce (BBG)

• Iran moves crude through the Strait of Hormuz at near pre-war rates, leveraging control amid other exporters' struggles (BBG)

• Japan aims to increase US crude oil imports due to Strait of Hormuz closure (NK)

IRAN

• Iran and Israel traded strikes on key energy facilities, Qatar’s Ras Laffan Industrial City suffered “extensive damage” after Iranian attack (BBG)

• US and Israeli forces launch attack on Iran's South Pars gas field, conflict's first strike on upstream facilities (RT)

• Israel says it has killed Iran's intelligence minister in third assassination in two days (CNBC)

• Iranian military publishes list of Gulf energy sites it may target after South Pars gas field strike from US and Israel (FP)

• Iran's foreign minister asserts the conflict won't change Iran's nuclear doctrine (RT)

STOCKS

• Nvidia secures Beijing's approval for H200 chip sales, adapts Groq chip for China (TI)

• Lululemon revenue up 1% to US$3.64bn, beat Q4 estimates but issued weak FY26 guidance of US$11.35bn to US$11.50bn, below consensus. Expects US$380m gross tariff hit in FY26, shares surprisingly rally 3.8% (CNBC)

• Micron Q2 FY26: revenue up 196% year-over-year to US$23.9bn, about 19% ahead of ests, EPS US$12.20 vs US$9.31 ests, record gross margins, shares flat (CNBC)

• Amazon CEO Jassy predicts AWS sales could reach $600bn by 2036, driven by AI demand (TI)

• OpenAI aims to transform ChatGPT into productivity tool, readies potential IPO by year-end (CNBC)

• Anthropic now accounts for over 73% of first-time AI tool spending, according to Ramp data (AX)

• Samsung secures preliminary agreement with AMD to develop next-gen AI memory and computing technologies (RT)

• AI drone software maker Swarmer rallies 520% on debut, best IPO performance since Newsmax almost a year ago (BBG)

CENTRAL BANKS

• Powell says not as much progress being made on inflation as 'hoped' (CNBC)

• Traders now fully pricing two rate hikes from the European Central Bank this year (BBG)

• BOJ seen to hold Thursday, commentary on Middle East conflict may shape April rate hike expectations (BBG)

• BoE may take aggressive actions against soaring energy prices post-Middle East war, anticipating significant inflation impact (BBG)

• RBA's split decision on Tuesday's rate hike fuels debate about timing of next move (BBG)

ECONOMY

• US February core PPI up 0.5% month-on-month vs. 0.3% ests, headline PPI up 0.7% vs. 0.3% ests, highest since Jul-25, goods increase 1.1% month-on-month (largest jump since Aug-23), with over 20% of the rise attributed to goods linked to fresh and dry vegetables (BBG)

• Japan export growth slows by less-than-expected, China-bound shipments contract due to LNY holidays (CNBC )

ASX TODAY

• Bubs Chair Paul discloses purchase of ~250,000 shares, lifts beneficial holding by 13.5% to 2.1m shares (BUB) 

• Orora CFO Shaun Hughes to leave the company, Paul Victor ex-CFO of Mainland Group appointed new CFO effective 4-Nov (ORA)

WHAT TO WATCH TODAY

• It's getting dark out there: A very downbeat overnight session, with all S&P 500 sectors red. Materials, Discretionary and Staples (a rather odd mix) all fell more than 2%. Powell's press conference effectively said they have no idea about the economic hit from Iran, US PPI was hot (and a negative read through as vegetable prices soared amid a fertiliser supply crunch) and oil is back at highs. The S&P 500 is really starting to roll over and ~0.5% away from hitting its 200-day, while the ASX 200 is set to dip into no man's land. It's getting rough out there.

• Materials: Commodity prices experienced an ugly unwind, with most key commodities (copper, gold, silver, palladium, platinum etc.) down 3-5% overnight. Very ugly session for all the resource-related ETFs, down 3-6%. Commodities are now being hit by deteriorating economic growth concerns and higher rates/yields, while local miners also have a diesel supply crunch (among other cost side issues). BHP ADRs dipped 3.0% overnight, now down 16.3% since 2-Mar.

BROKER MOVES

• Sims upgraded to Neutral from Underweight; target up to $21.50 from $19.50 (JARD)

• Woodside Energy Group downgraded to Neutral from Positive; however target up to $30.70 from $28.30 (E&P)

Stocks trading ex-dividend: 

• Thu 19 Mar: The a2 Milk Company (A2M) – $0.083, Briscoe Group Australasia (BGP) – $0.084, Cochlear (COH) – $2.15, Enero Group (EGG) – $0.01, K & S Corporation (KSC) – $0.05, Kelsian Group (KLS) – $0.08, Macmahon (MAH) – $0.01, PM Capital Global Opportunities Fund (PGF) – $0.07, Spark New Zealand (SPK) – $0.063, Yancoal Australia (YAL) – $0.122

• Fri 20 Mar: Latitude Group (LFS) – $0.05

Other ASX corporate actions today:       

• Dividends paid: Bell Financial Group (BFG), Dalrymple Bay Infrastructure (DBI), Dicker Data (DDR), Eagers Automotive (APE), EVT (EVT), Mayfield Group Holdings (MYG), oOh Media (OML), Qualitas (QAL), ResMed (RMD), Shaver Shop Group (SSG), Sonic Healthcare (SHL)

• Earnings: Premier Investments (PMV)

• IPOs: None

• AGMs: None

Economic calendar (AEDT):

• 11:30 am: Australia Unemployment Rate

• 2:00 pm: BoJ Interest Rate Decision (Ests: Hold at 0.75%)

• 6:00 pm: UK Unemployment Rate

• 11:00 pm: BoE Interest Rate Decision (Ests: Hold at 3.75%)

• 12:15 am: ECB Interest Rate Decision (Ests: Hold at 2.15%)