Trading Day: Role reversal, as Wall Street lags

ORLANDO, Florida, March 10 (Reuters) - Oil slumped more than 10% on Tuesday, the biggest one-day fall since 2022, on hopes that conflict in the Middle East will de-escalate. Asian and European stocks rose sharply, but in a rare instance since the war broke out, Wall Street lagged and U.S. stocks posted mild losses.

In my column today I look at parallels between the stresses emerging in private credit markets today and U.S. subprime mortgages in 2007. Of course, that doesn’t mean a global crash will follow, but investors should be aware of the potential risks under the hood.

If you have more time to read, here are a few articles I recommend to help you make sense of what happened in markets today. 1. Heaviest day of strikes yet on Iran despite market betsthat war will end soon 2. G7 energy ministers stop short of oil reserves release,ask IEA to study options 3. Aramco sees ’catastrophic consequences’ for oil marketsif Hormuz strait remains blocked 4. How oil shock and financial stress can feed each other:Mike Dolan 5. China’s exports turbocharge into 2026 afterrecord-breaking year

Today’s Key Market Moves * STOCKS: Solid gains in Asia - especially South Korea +6%- and European benchmark indices rise as much as 3%. For once,Wall Street lags - S&P 500 slips 0.2%; Nasdaq, Dow end flat. * SECTORS/SHARES: Only two U.S. sectors rise -communications services and tech. Energy -1.3%. 3M, Cisco,Caterpillar the top three gainers on the Dow, Boeing,Salesforce, Chevron the biggest decliners. Oracle +8% after thebell. * FX: Dollar slips as safety bid melts away. Aussie topG10 performer, Chilean peso top global performer, +2%. * BONDS: U.S. yields reverse course, end slightly higherat long end. Curve steepens as much as 4 bps. Three-year auctionis soft. * COMMODITIES/METALS: Oil tumbles 11% in another choppysession. Gold -2%.

Today’s Talking Points

* Timing is everything

Like many things in life, timing is everything in investing. In trading, it’s even more crucial. In that light, the last 24 hours have been particularly challenging for oil traders, to put it mildly, with crude prices notching their biggest intraday swings on record.

With oil trading in a $36 intraday range, as it did on Monday, fortunes and careers can be made - or lost - in minutes. Leveraged positions will be particularly exposed, and it wouldn’t be a total shock if it soon emerges that some hedge funds suffered some big losses.

* Fake news?

Underlining how sensitive markets are right now to headlines, oil extended heavy losses on Tuesday after U.S. Energy Secretary Chris Wright posted on X that the U.S. navy escorted a tanker through Strait of Hormuz, indicating that supply constraints may be easing.

But the post was deleted minutes later, and oil rebounded around $10, a bounce boosted by a CBS report that U.S. intelligence detected signs Iran may be considering steps to deploy mines in the Strait of Hormuz. Headlines can always move markets. But these are extraordinary times.

* Trading places

China’s powerful export machine is racing up through the gears. Exports in the first two months of this year soared 22%, more than three times the pace of growth in December and the Reuters poll forecast. The January-February trade surplus was $213 billion.

With tariffs crimping shipments to the U.S., trade with the rest of the world is booming. Last year’s record $1.2 trillion trade surplus, which revived complaints about China’s FX regime, could be broken this year. Meanwhile, figures from Berlin on Tuesday showed that German exports in January shrank at their fastest rate since May 2024.

What could move markets tomorrow? * Developments in the Middle East * Energy market moves * Japan wholesale inflation (February) * Germany CPI inflation (February, final) * European Central Bank board members Pedro Machado andIsabel Schnabel speak at separate events * U.S. Treasury sells $39 billion of 10-year notes atauction * U.S. CPI inflation (February) * U.S. Federal Reserve Vice Chair for Supervision MichelleBowman speaks on supervision and regulation

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