Markets Today: IEA eyes record breaking oil reserve release as US CPI looms. FTSE 100 falls at 200-day MA

• The IEA plans a record release of strategic oil reserves to cap crude prices, but ongoing US-Iran geopolitical conflict keeps energy supply risks high.
• Asian markets, led by major semiconductor stocks, saw a strong rebound, while European shares are set for a lower opening.
• The US dollar softened ahead of the critical US CPI release, but the Australian dollar surged on hawkish comments from the RBA.

Most Read: US Dollar Index (DXY): Technical picture as inflation and geopolitical uncertainty loom

Global markets found a sense of stability on Wednesday as a pullback in oil prices offered investors some relief, even as ongoing geopolitical tensions between the US, Israel, and Iran fueled lingering concerns regarding inflation and global economic expansion.

Despite this underlying anxiety, regional benchmarks saw a significant bounce back; MSCI’s broadest index of Asia-Pacific shares (excluding Japan) climbed 1.4%, while Japan’s Nikkei and South Korea’s Kospi both advanced by 1.7%. South Korean equities specifically rallied 3.8% to reach a one-week high, though trading remained cautious with volumes staying well below the 30-day average.

Similarly, Taiwan’s benchmark surged over 4%, nearing its own one-week peak.

This broad recovery was primarily driven by sharp rebounds in heavyweight semiconductor stocks.

In South Korea, Samsung Electronics and SK Hynix saw gains of 2.5% and 3%, respectively. Meanwhile, Taiwan Semiconductor Manufacturing Co (TSMC) led the charge with a jump of more than 5%, marking its strongest performance since early January and providing a much-needed lift to the regional tech sector.

European equity markets were set to open lower on Wednesday, retreating from the previous session's gains as investors faced a combination of geopolitical instability and energy market volatility.

The joint US-Israeli military campaign against Iran, known as "Operation Epic Fury," entered its 12th day with no clear resolution in sight. This continued uncertainty exists despite President Donald Trump’s assertions that the conflict which he described as a "short-term excursion" could conclude "pretty quickly."

In an effort to stabilize global markets, the International Energy Agency (IEA) has reportedly proposed the largest release of strategic oil reserves in its history, surpassing the 182-million-barrel record set in 2022.

This move helped cap oil prices, which had recently surged past $100 per barrel following the closure of the Strait of Hormuz.

On the economic front, European investors are focusing on final inflation data from Germany and retail sales reports from Spain and Turkey, while also monitoring corporate earnings from major firms like Inditex, Rheinmetall, and Porsche. These factors combined to pull premarket futures for the Euro Stoxx 50 and Stoxx 600 down by 0.4% and 0.3%, respectively.

The DAX Index is trading down around 0.60% after two days of gains. It will be intriguing to see how developments pan out on the US-Iran situation and whether or not the strategic oil reserves will be tapped. This will have a major impact on the direction of equities in today's session.

The US dollar softened on Wednesday as currency traders remained cautious, waiting for clearer direction regarding the ongoing conflict between the US, Israel, and Iran.

Fragile investor sentiment has been driven by contradictory signals over a possible resolution, causing the dollar index to ease to 98.773 pulling back slightly from the three-month high reached earlier this week.

In response, the euro strengthened by 0.18% to $1.163175, while sterling rose 0.25% to $1.3449. Conversely, the Japanese yen remained under pressure, trading at 158.14 per dollar, near its lowest level in seven weeks.

The most notable movement occurred with the Australian dollar, which surged 0.86% to reach $0.718, its highest point since mid-2022. This rally was largely triggered by hawkish remarks from Reserve Bank of Australia (RBA) Deputy Governor Andrew Hauser.

On Tuesday, Hauser warned that the recent spike in oil prices would likely drive inflation higher, signaling that the central bank may face increased pressure to raise interest rates at its policy meeting next week.

Currency Power Balance

Gold prices climbed slightly on Wednesday as safe-haven demand persisted, bolstered by a temporary retreat in oil prices that eased immediate inflation fears and revived hopes for Federal Reserve rate cuts later this year.

Spot gold rose 0.1% to $5,198.29 per ounce as the market awaited upcoming U.S. CPI data for further policy direction.

In contrast, US gold futures for April delivery dipped 0.7%, while silver and platinum also saw modest declines. Palladium bucked the trend among precious metals, rising 0.5% to $1,663.39.

Meanwhile, the energy sector remained volatile as oil prices rebounded following a massive 11% plunge on Tuesday. While the International Energy Agency (IEA) has reportedly proposed a record-breaking release of oil reserves surpassing the 182-million-barrel drawdown triggered by the 2022 invasion of Ukraine, investors remain skeptical that such a move can fully mitigate potential supply shocks from the conflict between the US, Israel, and Iran.

Brent futures climbed to $88.39 a barrel, while West Texas Intermediate (WTI) rose 1.2% to $84.43.

The scale of the proposed IEA intervention is historic, yet its long-term efficacy is being questioned by market analysts.

Goldman Sachs noted that even a stockpile release of this unprecedented magnitude would only offset approximately 12 days of the estimated 15.4 million barrels per day currently at risk due to disruptions in Gulf exports.

This narrow window of relief explains why crude prices began to climb again on Wednesday despite the IEA's efforts to saturate the market.

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As the trading day continues, markets remain cautious. The OPEC monthly report is the highlight from a data perspective in the European session.

The US session brings the release of February's CPI data where analysts are anticipating a 0.3% month-on-month increase in core inflation, which would surpass the current market consensus of 0.2%.

While such a print could place upward pressure on US Treasuries, the broader impact on the dollar may be limited, as the currency market continues to be more heavily influenced by volatile energy developments. The focus remains on whether inflation is stabilizing or if underlying price pressures are mounting ahead of future Federal Reserve policy decisions.

Parallel to the inflation outlook, global energy markets have reacted sharply to a Wall Street Journal report indicating that the International Energy Agency (IEA) is readying a record-breaking release of oil reserves. This news has already pushed Brent crude back below $90 per barrel, with the proposed drawdown expected to exceed the 182 million barrels released during the 2022 Ukraine crisis.

Estimates suggest that IEA members aim to compensate for at least 10 days of the 20 million barrels per day currently lost due to the blockade of the Strait of Hormuz.

Despite the potential for this massive reserve release to cap oil prices in the short term, market experts caution that such measures are only a temporary fix.

Sustained lower prices likely depend on a formal military de-escalation, and some interpret the IEA’s aggressive move as a signal that a ceasefire in the US-Israeli conflict with Iran is not imminent.

Consequently, the dollar is expected to maintain its current levels, as these mixed signals between stabilizing energy supplies and persistent geopolitical risks prevent any significant downward move.

From a technical perspective, the FTSE 100 index has recovered the gap down after the weekend and extended those gains before running into resistance at the 200-day MA.

Immediate support rests at 10269 before Mondays low around the 10100 comes into play.

For now though, this will depend on overall risk sentiment.

The period-14 RSI on a four-hour chart has also rejected at the 50 neutral level, which hints that selling momentum is still strong.

Resistance to the upside at 10456 (200-day MA) needs to be cleared if bulls are to make a run for the 10605 handle (100-day MA) and beyond.

FTSE 100 Index Four-Hour Chart, March 11, 2026

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