"Escort" blunder message stirs the market, crude oil "roller coaster," US stocks surge then retreat, emerging market currencies soar

The “U.S. escort” news about Oolong triggered a rollercoaster in oil prices, which in turn caused U.S. stocks to surge then retreat during the session, with U.S. bonds and the dollar falling together. The MSCI Emerging Markets Currency Index hit its best single-day performance since December 2023.

On Tuesday, U.S. stocks, increasingly sensitive to oil prices, rose then fell back. The S&P 500 declined 0.2%, the Nasdaq was essentially flat, and the Dow slightly declined by less than 0.1%.

According to CCTV News, U.S. Secretary of Energy Chris Wight posted on social media that the U.S. Navy successfully escorted a tanker through the Strait of Hormuz to ensure the continuous flow of oil to global markets. Oil prices subsequently fell below the intraday trading range, with WTI crude dropping nearly 20% at one point.

But the post was deleted shortly after. CCTV reports that Iran’s Islamic Revolutionary Guard Corps Navy Commander responded to the U.S. Secretary of Energy’s statement:

The claim that the U.S. military escorted a tanker through the Strait of Hormuz is pure lies. Any actions by the U.S. and its allies will be thwarted within Iran’s missile and drone range.

According to reports, White House Press Secretary Karoline Leavitt denied the escort incident, leading to a rally in oil prices, with WTI climbing back from around $76 to $86. After the International Energy Agency meeting, no strategic petroleum reserve statement was issued, and crude oil continued its upward trend, returning near yesterday’s late trading prices.

U.S. stocks show a strong negative correlation with oil prices, with a rebound in oil prices at the close directly dragging stocks down. Software and semiconductor stocks, which rebounded from lows last week, weakened again today.

Notably, the seven tech giants rose across the board, outperforming the 493 remaining components of the S&P 500, which also supported the Nasdaq’s late-day stability and prevented it from turning lower.

Due to oil price volatility unsettling Wall Street, traders are closely watching upcoming inflation data, especially after the latest employment report challenged the view that the labor market is stabilizing.

It is expected that Wednesday’s U.S. Consumer Price Index report will show core inflation, excluding volatile food and energy prices, rose only 0.2% last month. Despite recent energy price swings, the importance of this report has diminished.

Many companies like Amazon and Salesforce issued large amounts of corporate bonds, coupled with weak demand for the $58 billion 3-year U.S. Treasury auction. Overall, U.S. Treasury yields rose, with the 10-year yield up 6 basis points.

The dollar index was flat after a V-shaped move, with an intraday dip of 0.54%. The MSCI Emerging Markets Currency Index rose 0.9%, its best single-day performance since December 2023, after rising as much as 1.1% during the session.

Gold spot prices rose 1.2%, oscillating around $5,200, while silver gained 1.68%. Bitcoin surged then retreated, briefly surpassing $70,000.

On Tuesday, the three major U.S. stock indices showed mixed results. Airline and energy sector ETFs declined about 1.3%, leading sector ETFs lower. Oracle’s earnings pushed its stock up 10% at one point.

U.S. Stock Benchmarks:

• S&P 500: down 14.51 points, 0.21%, to 6,781.48
• Dow Jones Industrial: down 34.29 points, 0.07%, to 47,706.51
• Nasdaq Composite: up 1.158 points, 0.01%, to 22,697.104; Nasdaq 100: down 10.776 points, 0.04%, to 24,956.471
• Russell 2000: down 0.22%, to 2,548.08
• VIX (Fear Index): down 2.24%, to 24.93

Sector ETFs:

• Global airline ETF: down 1.36%
• Energy ETF: down 1.28%
• Internet, Financial, Banking, Consumer discretionary ETFs: down up to 0.60%

(March 10 U.S. sector ETFs)

The Magnificent 7 Tech Giants:

• Up 0.36%, at 195.68 points
• Nvidia: up 1.16%; Meta: up 1.03%; Amazon, Apple, Google A, Tesla: up to 0.39%; Microsoft: down 0.89%

Chip Stocks:

• Philadelphia Semiconductor Index: up 0.70%, at 7,865.119
• AMD: up 0.27%; TSMC: down 0.46%

Chinese ADRs:

• Nasdaq Golden Dragon China Index: up 1.96%, at 7,222.96
• NIO: initial +15%; CenturyLink: +13.5%; WeRide: +7.2%; Tencent: +10%; Alibaba: +3.1%; Baidu: +2.4%

Other Stocks:

• Berkshire Hathaway B: down 0.62%; Eli Lilly: down 0.70%
• Broadcom: down 0.92%; Netflix: down 1.40%; Oracle: down 1.43%; Salesforce: down 1.95%; Qualcomm: down 2.11%; Adobe: down 2.59%

European blue-chip stocks rose about 2.7%. German stocks gained around 2.4%, Italian banking sector up 4.3%.

Pan-European Stoxx 600: up 1.88%, at 606.12

Eurozone STOXX 50: up 2.67%, at 5,837.17

Major national indices:

• Germany DAX 30: up 2.39%, at 23,968.63
• France CAC 40: up 1.79%, at 8,057.36
• UK FTSE 100: up 1.59%, at 10,412.24

(March 10 Major European and US indices)

The 10-year U.S. Treasury yield rose about 6.2 basis points, with a notable increase in the New York afternoon.

U.S. Treasuries:

• At the close, the 10-year yield rose 6.18 basis points to 4.1576%, showing a W-shaped movement, briefly dipping below 4.09% before rising again.
• The 2-year yield increased 5.41 basis points to 3.59%; the 30-year yield rose 7.87 basis points to 4.7923%.

European bonds:

• In late trading, 2-year German yields fell over 6 basis points, 30-year yields rose slightly.
• UK 10-year gilt: down 9.3 basis points to 4.554%.
• France 10-year bond: down 6.7 basis points to 3.442%.

The dollar index was flat after a V-shaped move, with an intraday drop of 0.54%. The MSCI Emerging Markets Currency Index rose 0.9%, its best daily performance since December 2023, after rising as much as 1.1% during the session.

Dollar:

• ICE dollar index: up 0.11%, at 98.842, with a trading range of 98.939–98.492, showing a W-shaped pattern.
• Bloomberg dollar index: down 0.11%, at 1200.15, with a range of 1202.24–1195.63.

Non-dollar currencies:

• EUR/USD: down 0.22%; GBP/USD: down 0.14%; USD/CHF: up 0.12%
• Commodity currencies: AUD/USD: up 0.61%; NZD/USD: down 0.09%; USD/CAD: down 0.07%

Yen:

• USD/JPY: up 0.23%, at 158.04 yen, with a range of 157.28–158.04, showing a three-wave V pattern.

Offshore RMB:

• USD/CNH: at 6.8790, up 85 points from Monday’s close, trading within 6.8967–6.8605.

Cryptocurrencies:

• Bitcoin: surged then retreated, briefly above $70,000.

NYMEX April gasoline futures: $2.6403/gallon; March heating oil futures: $3.3466/gallon.

Crude Oil:

• WTI April crude: down $11.32, 11.94%, at $83.45/barrel.

(WTI futures)

• Brent May crude: $87.80/barrel.

Natural Gas:

• NYMEX April natural gas: $3.02/MMBtu.

NY gold futures rose over 1.9%, approaching $5,250 in early U.S. trading. NY silver gained about 5.2%, briefly surpassing $90.

Gold:

• Spot gold: up 1.10%, at $5,194.85/oz, continuing to rise since Asia-Pacific hours, but after 02:00 Beijing time, a short-term plunge brought it close to $5,160.
• COMEX gold futures: up 1.96%, at $5,203.70/oz; hit a daily high of $5,248.70 at 23:45.

Silver:

• Spot silver: up 1.79%, at $88.5168/oz.
• COMEX silver: up 5.17%, at $88.890/oz.

Other metals:

• COMEX copper: up 0.26%, at $5.9180/lb.
• Spot platinum: up 0.68%; palladium: down 1.86%.
• LME copper: up $186, at $13,140/ton;
• LME tin: down $246, at $50,439/ton;
• LME aluminum: up $20, at $3,406/ton.

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