The Monday Report – 09 March 2026

Array
(
    [0] => Array
        (
            [0] => ((L1G))
            [1] => ((MFG))
            [2] => ((COL))
            [3] => ((AAI))
            [4] => ((MND))
            [5] => ((NEC))
            [6] => ((RHC))
            [7] => ((RHI))
        )

    [1] => Array
        (
            [0] => L1G
            [1] => MFG
            [2] => COL
            [3] => AAI
            [4] => MND
            [5] => NEC
            [6] => RHC
            [7] => RHI
        )

)

This story features L1 GROUP LIMITED, and other companies.
For more info SHARE ANALYSIS: L1G
The company is included in ALL-ORDS

US markets traded lower on Friday, arguably a muted reaction against the 13.6% rise in WTI crude oil price to US$90/bbl.

Indications are energy prices are poised for further upside with ongoing war in the Middle East.

The ASX200 fell -3.78% last week. SPI futures are pointing to a sharp decline at the open on Monday.

Good Morning,

The ASX200 dived 347 points (-3.78%) last week to finish at 8951, snapping a three-week winning streak and marking its worst weekly performance in eleven and a half months.

The sell-off was driven by deepening anxiety over the conflict in the Middle East, compounded by a hawkish shift from the RBA as RBA Governor Michele Bullock emphasised every meeting “is live”, a stark warning ahead of next week’s Board meeting. 

The rates market starts the week pricing in 7bp of RBA rate hikes for the RBA’s Board meeting next week (17th of March), with a full 25bp rate hike priced in for May. 

As reported by Tony Sycamore, IG.

NAB Markets Today Research extract

With no sign of anything beyond perfunctory attempts to change the trajectory in the Middle East conflict, Brent crude topped US$92. 

Weak US nonfarm payrolls and tepid retail sales reports further dented investor confidence. Equities are down -1-2% across most major European and North American indices. Outside of Treasuries, bond yields are broadly higher.

Key Middle East oil producers are slowing production as the effective closure of the Strait of Hormuz fills up storage facilities. Meanwhile, Israel’s attacks on oil infrastructure near Tehran on Saturday have drawn retaliatory fire from both Iran and Hezbollah on Israel’s Haifa refinery complex and other key civilian infrastructure, including a water desalination plant in Bahrain.

Prime Minister Netanyahu and President Trump both pledged harder hits and a wider array of targets — Israel specifically nominating further hits on Iranian energy infrastructure. (Whilst back closer to home for the US, Trump said Cuba will “fall pretty soon.”)

Iranian President Pezeshkian said on Saturday the military has been instructed not to attack neighbouring countries that are not participating in (or hosting) action against Iran, although this stance was weakened with further comments on Sunday.

Bloomberg reported Saudi Arabia is stepping up direct talks with Iran. Iran’s Assembly of Experts said a new Supreme Leader had been chosen, but they aren’t disclosing who.

US nonfarm payrolls for February shrank by -92k, not only falling dramatically short of the median forecast (up 55k) but also well below every economist surveyed by Bloomberg. 

The unemployment rate lifted one-tenth to 4.4%. Ameliorating factors are scant.

While there was a healthcare strike in California, the weather was probably a positive for this print. Pantheon Macroeconomics noted even without the strike, and if the contribution from the birth-death model hadn’t been lower due to recent revisions, payroll growth would still be negative. Average hourly earnings at up 0.4% m/m did, however, beat consensus.

The simultaneously released US retail sales for January, while not disappointing, were at best uninspiring. The headline print, at -0.2%, was down a little less than expected. Ex-autos were flat, as expected, and the control measure for GDP was up 0.3%, again as expected.

Several FOMC officials offered views ahead of the March meeting blackout. Cleveland Fed President Hammack said there are two-sided risks to her base case that “policy should be on hold for quite some time.”

Boston Fed President Collins holds similar views. Fed Governor Bowman was attuned to February payrolls, saying “the labour market continues to be weak, and it could use some support from our policy rate.”

Across the pond, the ECB’s Schnabel reiterated the ECB’s recent “good place” mantra, albeit with a need to be “vigilant” about the energy price shock.

Equities ended the week with a consumer discretionaries-, materials- and technology-led -1.3% sell-off in the S&P500, leaving it -2.0% lower for the week. 

Broadly similar performance was seen in the major European indices in Friday’s trading, but the weekly returns across the pond were much more declivitous: the FTSE 100 is down nearly -6%, and the CAC40 and DAX both closer to 7%.

In foreign exchange, the risk-off tone didn’t extend to further strengthening of the USD, which was down on the session but still held on to a 1.4% gain for the week, the largest since August. 

AUD/USD is down -1.2% for the week to just below 0.70. The biggest relative currency gainer during the Middle East conflict so far is the oil-sensitive CAD, up 0.5%.

US Treasuries were torn between the competing extremes of energy prices marching sharply higher and weak domestic data.

By the end of the day, despite very chopping that covered a 8bp range in less than 30 minutes, Treasury yields were left little changed from the prior New York close (4.14% for the 10Y). This puts the 10Y yield up 20bp since the 27 February (pre-conflict) close. Pricing of Fed cuts has fallen from -60bp to -44bp over the week (having been at less than -40bp before payrolls).

Other bond markets saw material yield increases, especially in Gilts (6-8bp higher across the curve), where the UK’s tendency for energy pass through from gas prices is seen as a sharp threat to the cuts the BoE was expected to deliver this year: the market has shifted from pricing some chance of more than two cuts to just 33% of one easing.

Short-dated European bonds (Schatz yields up 8bp) performed similarly to Gilts on Friday but outperformed at the long end.

ANZ Bank, Australian Morning Focus extract

Crude oil recorded its biggest weekly gain since 2022 as the Middle East conflict unleashes a wave of disruptions across energy markets.

Brent crude rallied nearly 28% to push above US$90/bbl as shipping through the Strait of Hormuz grinds to a halt. That’s despite President Trump suggesting the US Navy would escort vessels through the waterway, while the US International Development Finance Corporation would offer insurance to vessels to help ensure the flow of energy.

The Joint Maritime Information Centre, a multinational naval advisory group, said there has been a near total pause in commercial traffic through the Strait. It said the collapse stems from security threats, insurance constraints and effective disruptions.

The prospect of a drawn-out conflict is raising concerns of a sizable hit to supply. Iranian Foreign Minister, Abbas Araghchi, said Iran had no intention of negotiating with the US and was ready for a ground invasion.

President Trump said he is not interested in negotiating with Iran and raised the possibility the conflict would only end once that country no longer has a functioning military. Concerns of supply disruptions rose over the weekend on reports that producers are starting to reduce production.

The United Arab Emirates and Kuwait have started to reduce oil production as storage runs out. They join Iraq, who’s output is down about -60%.

The moves are in anticipation of a prolonged closure of the Strait.

By reducing production they are trying to avoid complete shutdown of operating wells, which would make it harder to restart production quickly.

Compounding matters is the rising threat of direct hits to energy infrastructure. Saudi Arabia intercepted drones that were heading towards the Shaybah oil field, which produces 1mb/d. Strikes in Bahrain and Qatar have continued.

Saudi Arabia is diverting record amounts of crude to its Red Sea coast for export, helping alleviate some of the pressure. The situation exceeds even the worst-case scenario we envisaged before the initial attacks on Iran by US and Israel miliary forces.

The likelihood of further gains in oil prices is high.

Global gas markets recorded strong gains as supplies are also hampered by the Middle East conflict. European natural gas rose 67% last week, its biggest weekly gain since the energy crisis of 2022.

Qatar’s Energy Minister said that even if the conflict ended immediately, it would take the country “weeks to months” to return to a normal cycle of deliveries. This follows the forced closure of Ras Laffan, the world’s biggest LNG plant following an Iranian drone assault.

Western Europe is vulnerable due to low storage levels following the heating season.

Spot North Asian LNG prices gained more than 46% last week, to trade near US$22/MMBtu as traders rush to secure alternative supplies.

The conflict is threatening supplies in the industrial metals sector. Aluminium rallied 11.7% last week, as smelters in the region closed. Aluminium Bahrain BSC suspended deliveries of metal. This follows Qatalum’s initiation of a controlled shutdown of output, with a full restart expected to take six to twelve months.

Copper escaped the mayhem, with prices steady amid concerns of weaker demand in China.

Gold prices oscillated as strong haven buying was offset by concerns of higher energy prices stoking inflation and delaying rate cuts by the Fed. 

Will Brent Cross the $100 Rubicon? Stephen Innes, SPI Asset Management extract

There are moments in markets when a price is no longer just a price. It becomes a line in the sand, a psychological threshold that changes behaviour across every asset class.

Brent flirting with US$100 is exactly that kind of moment. It is the market’s Rubicon. Once crossed, traders stop debating valuation and start managing consequences. The week ahead is shaping up as a referendum on whether crude merely tests that line or whether the Middle East war machine is about to march straight through it.

The backdrop could hardly be more combustible. The Middle East conflict has now entered a phase where geopolitics is no longer background noise but the central signal on the macro dashboard.

With shipping through the Strait of Hormuz effectively paralyzed, the market is staring directly at the world’s most sensitive energy choke point.

Roughly one-fifth of global oil and LNG flows pass through that narrow corridor, which means every stalled tanker is not just a logistical problem but a tightening valve on the global growth machine.

Brent’s leap from US$70 to north of US$90 in a matter of days tells you everything about how quickly risk premiums can reprice when the physical plumbing of the energy system starts to seize.

For equity markets, the transmission mechanism is brutally simple.

Energy is not just another sector input but the tax collector of the global economy. When oil surges, consumers feel it at the pump, margins compress across transport and manufacturing, and central banks suddenly find their inflation fight complicated by a fresh external shock.

That dynamic has already begun to bleed into the tape.

The S&P slipped roughly -2% on the week while the VIX quietly pushed toward levels not seen in nearly a year, a classic sign that investors are shifting from directional optimism to protection buying.

But markets right now are not panicking. They are hesitating.

Think of the current environment less like a crash and more like a crowded theatre where everyone has suddenly noticed the smell of smoke, and folks are just now starting to feel the heat of the fire.

Investors are neither aggressively selling nor enthusiastically buying. Instead, they hover in that uncomfortable middle ground where positioning becomes cautious but conviction remains thin. In trading parlance, this is the moment when liquidity quietly retreats and price moves start carrying more informational weight.

The real macro complication arrives next week in the form of inflation data. February CPI lands squarely in the middle of this geopolitical storm, but with a crucial twist. The data largely predates the energy spike.

That means a benign print could easily be dismissed as stale information, while an upside surprise would carry far greater significance because it would suggest inflation pressures were already simmering before oil began its ascent. In other words, the CPI release may be less about the past and more about the market’s tolerance for what lays ahead.

This matters enormously for the interest rate narrative that has underpinned the equity rally over the past year.

The bull case for risk assets has relied heavily on the assumption the Federal Reserve can deliver roughly two quarter-point cuts this year.

Those expectations are already wobbling as traders grapple with the possibility that higher energy prices could reignite inflation expectations. Markets are currently assigning less than even odds to a June cut, a subtle but meaningful shift in the monetary policy backdrop.

Here is where oil becomes the central macro barometer. If Brent stabilizes back in the US$85 zone, investors will continue to interpret the surge as a geopolitical premium rather than a structural supply shock.

Risk assets can digest that kind of environment, particularly if the economic data continues to show only moderate cooling.

But if Brent breaks through US$100, the psychology changes immediately. Triple-digit oil has a way of forcing asset allocators to rethink everything from consumer demand to rate trajectories.

It is the level where inflation fears stop being theoretical and start feeding directly into portfolio construction.

I say we should probably brace for some kind of impact!!

Corporate news in Australia:

-Koala IPO is seeking to raise $68m with a $300m market cap

-Grant Thornton Australia is in advanced discussions to sell the business to its American counterpart

-L1 capital ((L1G)) is aiming to raise between $300m-$400m for its new precious metals listed investment company

-FDC Construction & Fitout has appointed investment banks to start the IPO process targeted for June, with a market capitalisation of over $1bn

-Betashares is reported as the lead investor in a funding round by stable coin issuer Macropod

-The Lowy family has taken a substantial shareholding in Magellan Financial Group ((MFG))

-Richard White-backed Vinyl Group has acquired around 50 media outlets as part of a rapid expansion strategy across digital publishing assets

-Oaktree Capital is marketing to US investors ahead of a potential exit from wealth advisory platform AZ NGA

-Coles Group ((COL)) says it was unaware security guards employed by contractor MA Services were allegedly underpaid, while the United Workers Union is calling for a wider industry review

-Santos has launched its $6bn Barossa LNG project after years of regulatory and environmental hurdles

On the calendar today:

-CH Feb CPI, PPI

-US Jan Housing starts

-ALCOA CORPORATION ((AAI)) ex-div 9.82c

-MONADELPHOUS GROUP LIMITED ((MND)) Investor/Analyst Roadshow

-NINE ENTERTAINMENT CO. HOLDINGS LIMITED ((NEC)) ex-div 4.50c

-RAMSAY HEALTH CARE LIMITED ((RHC)) ex-div 42.50c (100%)

-RED HILL MINERALS LIMITED ((RHI)) ex-div 11.60c (100%)

FNArena’s four-weekly calendar: https://fnarena.com/index.php/financial-news/calendar/

The Australian share market over the past thirty days…

For more detail go to FNArena’s Australian Broker Call Report, which is updated each morning, Mon-Fri.

All overnight and intraday prices, average prices, currency conversions and charts for stock indices, currencies, commodities, bonds, VIX and more available on the FNArena website.  Click here. (Subscribers can access prices on the website.)

(Readers should note that all commentary, observations, names and calculations are provided for informative and educational purposes only. Investors should always consult with their licensed investment advisor first, before making any decisions. All views expressed are the author’s and not by association FNArena’s – see disclaimer on the website)

All paying members at FNArena are being reminded they can set an email alert specifically for The Overnight Report. Go to Portfolio and Alerts on the website and tick the box in front of The Overnight Report. You will receive an email alert every time a new Overnight Report has been published on the website.

Find out why FNArena subscribers like the service so much: “Your Feedback (Thank You)” – Warning this story contains unashamedly positive feedback on the service provided. www.fnarena.com

FNArena is proud about its track record and past achievements: Ten Years On

Click to view our Glossary of Financial Terms