2026-03-10 08:46:00
Major indices in Europe are eyeing roughly 2% gains and a little more to start the session now. That as oil prices come off the boil from yesterday with markets eyeing the IEA emergency oil reserves release and potential US SPR selling too. Adding to that, US president Trump has also said that the war may soon come to an end. And that is giving market players hope of a brighter outlook, at least for now.
S&P 500 futures are also seen up 0.5% now, at the highs for the day. This follows from the dramatic turnaround overnight which saw the main index close 0.8% higher as well. At the lows, the S&P 500 traded down by 1.5% in early stages of US trading yesterday.
As oil prices simmer well below the highs at the early stages this week, we’re also seeing market pricing readjust again in terms of the outlook for major central banks. At one point yesterday, traders had even fully priced in a rate hike by the ECB for this year but the odds of that have now dropped back. A move before July was seen around ~80% yesterday but is now down to just ~60%.
It is a timely retreat as well since the central bank bonanza will return next week. So, expect policymakers from major central banks to outline their initial thoughts to the US-Iran conflict. All else being equal, they should just mention that they will not be in a rush to prejudge the situation and keep a close watch on energy price developments.
The whole point is to identify if this episode will be “transitory” or not. Another famous last words case for some central banks like what we saw back in 2021-22?
