Oil wreaks havoc – North American Session Market Wrap for March 12

Log in to today's North American session Market wrap for March 12

The picture is now looking very different to the first part of the week.

Yesterday, we warned of rangebound Markets except in the event of an Oil breakout.

The irony is in the timing, as Crude didn't waste anytime to do so in the following hours. Closing at around $87 per barrel, the commodity quickly extended to $96 in the North American Session.

The panic started at the beginning of Asia trading, with news of more ships being attacked in the Strait of Hormuz taking the conflict to a new escalation.

Markets are very afraid of a prolonged war, and the effect can be seen in global Stock Indexes, falling between 1.50% in Japan to close to 2% in the US.

Inflation is not the investors' best friend, and it even becomes a foe when it leads to the pricing out of much-expected Rate cuts.

Pre-war, FOMC cuts were at an optimistic 65 bps and are now back towards the current 23 bps.

Note: President Trump is speaking live and he is moving Markets, so tag in to check what he has to say. Metals are diving since.

Things may change if higher energy costs materialize into lower economic activity, similarly as what had happened in 2008, but it is certainly not the case for now.

WTI is closing near its session highs, but stalled its rise in the last few hours of trading.

Heavy rounds of US Data will be coming tomorrow; Even if they won't allow a now very-forward looking Market to reprice inflation expectations, softer data could at least soothe rate-cut fiends.

Read More:

• USD extends its lead as Fed cuts price out: USD/JPY to new cycle highs
• Markets resist and volatility fades – North American Mid-Week Market Update
• Dow Jones tumbles 600 points on Strait of Hormuz tensions and private credit jitters, support at 46660 is key
• Silver (XAG/USD) rejects triangle formation from Iran War – Breakout scenarios

Today's session is not a pretty one – As was warned in our past session Stock Market outlook, any rebound in Oil would have brought bloodshed to an already fragile investor sentiment.

Except for a few local sector like Energy and Process industries, the struggle was widespread.

Today's session wasn't pretty, with virtually all asset classes dropping against the US Dollar and WTI, up around 8.50% in the past 24 hours!.

Metals are seeing imminent struggles, diving towards the session close – Could be moving on the latest Trump attempts to reassure the public of advances in Iran!

Today marked yet another Dollar day – the USD is on top of the FX performance schedule, rising again from its positive correlation with the Oil.

The Canadian Dollar also rose, which isn't too surprising but Yen making a return higher is quite surprising – Keep an eye on a potential reversal in coming sessions.

Check out our latest JPY analysis to learn more.

Tomorrow will be a banger for volatility traders, particularly with the streak of high-tier US Data.

This includes US Core PCE, U-of-Mich Consumer Sentiment and much more.

Don't forget Canadian Employment at 8:30 A.M. ET!

Keep a close eye on sentiment and Middle East news.

Safe Trades!

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