Oil hits four-month high as hawkish central banks and Hormuz tensions rattle markets
This week @ 15:30 pm Friday 11th September in London.
Markets:
- FTSE 100 fell 2.05% this week to 10,608.92, weighed down by a broad risk-off tone across UK and European equities as the escalating Iran conflict pushed oil towards four-month highs, with losses tempered by a stronger-than-expected July GDP print released on Friday.
- S&P 500 fell 0.64% this week to 7,669.59, pressured by a hotter-than-expected US producer price report that lifted expectations of a Federal Reserve rate increase at next week’s meeting, alongside the continued rise in energy costs.
- Nasdaq Composite fell 0.42% this week to 26,395.33, as elevated Treasury yields and rate-hike concerns weighed on technology and chip-related names.
- STOXX Europe 50 fell 1.76% this week to 5,335.88, marking its sharpest weekly decline since April, as a hawkish European Central Bank rate rise added to concerns over the inflationary impact of surging energy prices.
Bonds:
- UK 10-year gilt yields rose 21.7bps this week to 5.27%, as oil-driven inflation concerns and rising rate expectations continued to dominate, despite the stronger UK growth data.
- US 10-year Treasury yields rose 15.0bps this week to 4.93%, moving closer to the 5% level, as hot producer price data reinforced bets on a Federal Reserve rate rise at next week’s meeting.
Commodities:
- Brent crude rose 9.06% this week to $105.00/bbl, having briefly touched a four-month high near $110/bbl, as an escalation in the Iran conflict further disrupted tanker traffic through the Strait of Hormuz.
- Gold fell 1.15% this week to $4,425/oz, as rising US rate-hike expectations and a firmer dollar reduced demand for the non-yielding metal.
- Copper fell 1.80% this week to $6.56/lb, as a firmer dollar and mixed demand signals offset ongoing supply tightness.
FX:
- GBP/USD fell 0.06% this week to 1.3508, broadly stable as sterling’s support from stronger UK growth data was offset by a firmer dollar on rising US rate expectations.
- GBP/EUR rose 0.08% this week to 1.1649, with sterling supported by the stronger-than-expected UK GDP figures.
Macro:
- UK GDP grew 0.4% m/m in July, comfortably beating expectations of no growth, with annual growth accelerating to 1.6%, its fastest pace since early 2025, driven by the services sector.
- US producer prices rose 0.4% m/m in August (5.4% y/y), a touch above forecasts, lifting market-implied odds of a Federal Reserve rate increase at next week’s meeting to around 60%. US CPI, also released this week, matched forecasts at 0.4% m/m, with annual inflation holding at 3.4%.
- The European Central Bank raised interest rates this week to 2.5%, its second hike of the year, warning of higher inflation as energy costs continue to rise.
- Tensions around the Strait of Hormuz remained the dominant driver of energy markets, with reports of a direct exchange between Iranian naval forces and a US unmanned vessel adding to disruption of tanker traffic through the strait.
Company news:
- AstraZeneca received US FDA accelerated approval for Etcamah (camizestrant) in combination with a CDK4/6 inhibitor as a first-line treatment for a form of metastatic breast cancer, alongside positive Phase III data showing its respiratory drug tozorakimab reduced COPD exacerbations by around 30% versus standard therapy.
What we will be keeping an eye on next week…
w/c 14th September 2026
- US Federal Reserve FOMC meeting: Wednesday 16th September
- Bank of England MPC meeting: Thursday 17th September.
- Bank of Japan Monetary Policy Meeting: Friday 18th September
Enjoy the weekend
Markets move constantly and the numbers in this update will change. This is a snapshot only, pulled together from a range of sources, and is meant as a quick guide rather than a precise record. It’s not investment advice and shouldn’t be used to make trading or investment decisions. If you need more accurate or specific data over a defined period, please get in touch with a member of the team who will be happy to help.
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