Oil jumps 5% as Iran strike talk meets a hurricane

Rundown · 2026-10-08

Oil is the story again, and this time it has two causes. Brent is $105.32, +$5.12 (+5.11%) and WTI $92.76, +$4.48 (+5.07%), both at the top of their overnight ranges. The first cause is a report, dated Wednesday, that the White House asked the Pentagon for options to strike Iranian targets before the 3 November midterms (The Atlantic, via AP). The second is Hurricane Isaias, the first hurricane of the Atlantic season, which has led producers to shut more than 500,000 b/d of Gulf of Mexico output ahead of a northern Gulf Coast landfall Friday night or early Saturday. The 10-year is 5.356%, +6.1bp, close to Wednesday's intraday 5.368%, the highest since 2002. ES is 7,808.75, -44.00 (-0.56%), near its overnight low and about 89 points below Tuesday's record. YM is weakest of the four. Jobless claims at 08:30 are the only scheduled print before the 30-year auction at 13:00.

Overnight

Against Wednesday's settles, as of about 06:55 ET (delayed; MarketWatch for ES, TradingView for the rest). ES (Dec) 7,808.75, -44.00 (-0.56%) from 7,852.75 · NQ 31,147.00, -255.25 (-0.81%) from 31,402.25 · YM 50,963, -486 (-0.94%) from 51,449 · RTY 2,782.5, -29.7 (-1.06%) from 2,812.2
Wednesday's settles reconcile with Tuesday's. ES -21.25 (-0.27%) from 7,874.00 · NQ -81.00 (-0.26%) from 31,483.25 · YM -367 (-0.71%) from 51,816 · RTY -36.0 (-1.26%) from 2,848.2. MarketWatch's ES settle matches TradingView's
Reference levels, and nothing more. Globex ranges so far: ES 7,802.75-7,858.25 · NQ 31,119.75-31,466.00 · YM 50,909-51,470 · RTY 2,778.6-2,813.5. All four are within a few ticks of their overnight lows. Wednesday's full ES range was 7,815.75-7,884.50, so ES is now below Wednesday's low. The ES contract high is 7,897.50, from Tuesday
The Dow and the Russell are leading lower, not the Nasdaq. YM is down about 1.7 times as much as ES in percentage terms, after Caterpillar took most of the Dow's loss on Wednesday (see Index Movers). NQ is down less than YM despite weaker semis pre-market: NVDA -1.08%, MU -2.02%
Asia fell about 1.4%. Nikkei 69,042.11, -993.60 (-1.42%) · Hang Seng 23,785.79, -344.71 (-1.43%) · Shanghai Composite 3,811.90, -0.79%, on its first session back after the Golden Week holiday. Samsung's preliminary third-quarter operating profit was 107.4 trillion won, up 782.5% on AI memory demand (AP), but it did not lift Korean or US chip names overnight
Europe is down a little less than 1%. DAX 24,907.54, -0.78% · CAC 40 7,706.54, -0.81% · STOXX 600 624.98, -0.84% · FTSE 100 10,416.83, -0.40% (mid-session, MarketWatch). German exports fell 0.8% in August against a 0.8% rise expected (Trading Economics). The FTSE is falling least, which fits its heavy energy weighting
Iran. The Atlantic reported on Wednesday that the scale and targets of any strikes were still under discussion, and that a wider operation could follow the 3 November vote. UK officials have reported at least nine attacks in the Strait of Hormuz in October (AP via Euronews). There has been no official US confirmation

The Dollar & FX

DXY 102.39, +0.15 (+0.15%) from Wednesday's 102.24 (ICE, via MarketWatch, last updated 05:13 ET), range 102.13-102.40. The 52-week high is 102.54, from Monday. The dollar is firm but not surging, because the move in US yields is matched by Europe: the Bund is +6.0bp at 3.549%, the same as the 10-year Treasury's +6.1bp
6E is still the weakest major. EUR/USD 1.1180, -0.0018 (-0.16%) from 1.1198, range 1.1177-1.1216. The 52-week low is 1.1162, Monday's 17-month low, so the pair is 18 pips above it. The French 10-year is 4.970%, +7.8bp, close to its 52-week high of 5.028%. The OAT-Bund spread is about 142bp, from about 140bp at Wednesday's close. The ECB's account of its September meeting is at 07:30 ET, and ECB chief economist Lane spoke at 06:00 ET
6B. GBP/USD 1.3198, -0.0016 (-0.12%) from 1.3214, range 1.3184-1.3240. BoE Governor Bailey speaks at 08:15 ET, a quarter of an hour before claims
6C is flat with oil up 5%. USD/CAD 1.4261, +0.0002 (+0.01%) from 1.4259, range 1.4244-1.4273, close to the 52-week high of 1.4297. A 5% oil move would normally lift the loonie. It hasn't today, because the US rate move is offsetting it. Canada's September jobs report is Friday at 08:30
6J and 6A. USD/JPY 158.27, +0.19 (+0.12%) from 158.08, range 157.59-158.31. AUD/USD 0.6944, -0.0019 (-0.27%) from 0.6963, range 0.6942-0.6969, at its low, the risk-off move in FX
Waller spoke at 04:30 ET in Istanbul. He said that if data come in as expected he anticipates "additional hikes", but that they do not need to come at consecutive meetings, which leaves room to hold on 27-28 October (Reuters, via the Globe and Mail; FXStreet). He named the Iran energy shock and AI-driven demand as inflation risks, and said he was "not greatly concerned" that tighter policy would cause a damaging slowdown. The 2-year is 4.827%, +5.9bp, so the front end is rising as fast as the 10-year
October hike odds. Reuters reported about a 20% market-implied chance of an October hike this morning; Yahoo Finance had about 17% after Wednesday's minutes. The desk could not pull a current Polymarket or CME FedWatch reading directly, so treat both as approximate. December was about 75% on Polymarket on Wednesday morning

Energy & Metals

CL: November settled $88.28, -$1.16 (-1.30%) on Wednesday, reconciling with Tuesday's $89.44. MarketWatch and TradingView agree. It is $92.76, +$4.48 (+5.07%) now, range $88.77-$92.84, so it is trading at the top of its range. The 52-week high is $119.48
Brent: December settled $100.20, -$0.38 (-0.38%), reconciling with $100.58. MarketWatch and TradingView agree. It is $105.32, +$5.12 (+5.11%) now, range $100.76-$105.46. The Brent-WTI spread is about $12.56, wider again than about $11.90 on Wednesday morning
The mechanism: a war premium and a supply outage together. Wednesday's small fall came as the IEA said members backed faster stock releases, prioritizing diesel, and EIA showed a crude draw of 3.19M barrels that was mostly an accounting adjustment (see Yesterday's Data). Overnight, the strike report adds war risk to Gulf supply, and Isaias removes US Gulf supply that the market had been counting on to offset Middle East losses. The front of the curve is moving most: November WTI is +$4.48, December +$4.17, January +$3.59 (MarketWatch). That is what a near-term supply loss looks like, rather than a longer-term repricing
Hurricane timing matters for the next two sessions. Weather.com and AccuWeather put landfall on the northern Gulf Coast Friday night or early Saturday. Shut-ins usually grow as a storm approaches and only reverse once platforms are inspected, so this is a weekend risk for CL. Friday's Baker Hughes rig count at 13:00 is the next scheduled energy data
GC: December settled $4,140.70, -$46.40 (-1.11%) on Wednesday, reconciling with Tuesday's $4,187.10. MarketWatch and TradingView agree. It is $4,145.50, +$4.80 (+0.12%) now, range $4,128.10-$4,166.80. This is the change worth noting. For three sessions gold has fallen when yields and the dollar rose. This morning the 10-year is up 6bp and DXY is up, and gold is flat. The strike report is the most likely reason
Rates. 10-year 5.356%, +6.1bp from Wednesday's 5.295%, range 5.284%-5.358%; 52-week high 5.368%. 2-year 4.827%, +5.9bp from 4.768%. 30-year 5.728%, +5.5bp, a new 52-week high, ahead of today's 30-year auction. 2s10s is about 53bp. All Treasury figures are Tullett Prebon via MarketWatch, about 07:05 ET

Where We Left Off

Wednesday's RTH close, per AP: S&P 500 7,801.77 (-17.16, -0.2%) · Dow 51,179.87 (-341.41, -0.7%) · Nasdaq Composite 27,538.69 (-61.20, -0.2%) · Russell 2000 2,793.20 (-37.09, -1.3%). MarketWatch matches all four to the cent. The Nasdaq-100 fell 0.21% to 31,160.08. The S&P MidCap 400 fell 1.62% and Dow Transports 0.88%; Dow Utilities rose 0.23%. The VIX closed at 15.65, +0.57
Small and mid caps fell six to seven times as much as the S&P. The S&P lost only 0.2% while the 10-year traded at its highest level since 2002 intraday, because the largest weights held up: AAPL +0.91%, MSFT +0.09%, MU +4.06%. The rest of the market did not
What carries over: the same rate pressure, now with oil added. The 10-year was 5.368% intraday on Wednesday and closed at 5.295% after a strong 10-year auction. It is back at 5.356% this morning, before a 30-year auction

Yesterday's Data

On The Calendar Today

Time ET · Event · Consensus · Prior · Hits

07:30 · ECB account of September meeting · n/a · n/a · 6E

08:15 · BoE Governor Bailey speaks · n/a · n/a · 6B

08:30 · Initial jobless claims, w/e 3 Oct · 200K · 197K · USD · ES/NQ · GC

08:30 · Continuing claims, w/e 26 Sep · 1,710K · 1,701K · USD

09:20 · NY Fed bill purchases, 1-4 months · n/a · n/a · USD

10:00 · Wholesale inventories, Aug · 0.7% · 1.3% · USD

10:30 · EIA natural gas storage · +79 Bcf · +64 Bcf · NG

11:00 · Atlanta Fed GDPNow, Q3 · n/a · 3.7% · USD

11:30 · 4- and 8-week bill auctions · n/a · 3.89% / 3.99% · USD

12:00 · Freddie Mac 30-year mortgage rate · n/a · 7.28% · USD

13:00 · 30-year bond auction · n/a · 5.308% · USD · ES/NQ · GC

13:40 · Fed's Musalem speaks · n/a · n/a · USD

16:30 · Fed balance sheet, H.4.1 · n/a · $6.743T · USD

The calendar was built from TradingView's economic calendar and cross-checked against Trading Economics. Both list the same US events. The 08:30 slot has claims and nothing else, and the 10:00 slot has wholesale inventories only. Thursday's fixed weekly releases are both included: claims at 08:30 and EIA natural gas at 10:30. Waller's 04:30 speech has already happened (Federal Reserve calendar). The ECB and BoE times are from Trading Economics. PepsiCo reported before the open (see Index Movers).

Claims are the only morning print that is likely to move anything, and the fulcrum is still rates. Claims have been low, at 197K last week, and a Fed that is already signalling hikes will not change course on one weekly number. A high print would push against the rise in the 2-year; a low one would support it. The bigger test is 13:00. The 30-year is about 42bp above the 5.308% sold last month and at a 52-week high. Wednesday's 10-year auction was strong, with dealers taking a record-low 2.5%. Another strong result would ease the pressure on long yields; a weak one, with oil up 5%, would add to it. Musalem speaks 40 minutes after the result.

Index Movers

Ranked by index contribution. The Dow is price-weighted, so $1 in any constituent is worth about 5.9 Dow points (approximate). Closes and pre-market quotes are from MarketWatch, about 07:05 ET.

CAT $813.83, -$49.61 (-5.75%), worth about -290 Dow points, most of the Dow's -341. That is why YM fell more than twice as hard as ES on Wednesday and is weakest again this morning. Reported causes: long yields at a two-decade high, which hit equipment bought on credit (24/7 Wall St); a Truist price-target cut to $1,100 from $1,225 and a Zacks downgrade (Investing.com); and an FTC and USDA request for information on farm equipment that names Deere (Benzinga). CAT is -1.82% pre-market at $799.00
NVDA $237.47, -0.74%, the largest S&P 500 and Nasdaq-100 weight at about $5.72T, is -1.08% pre-market. MU rose 4.06% to $1,088.00 on Wednesday and is -2.02% pre-market, despite Samsung's result. AAPL +0.91% and MSFT +0.09% held up the S&P on Wednesday; both are flat pre-market
PEP $123.73, -1.58%, an S&P 500 and Nasdaq-100 name, is +1.83% pre-market after third-quarter results. Core EPS was $2.34, against previews of about $2.29-$2.31. Net revenue was $25.27B, +5.6%, organic revenue +3.1%. But PepsiCo cut its full-year core EPS growth outlook to +2.5% to +3.5%, from the low end of +5% to +7% (SEC 8-K). The analyst call is at 08:15
XOM $164.05, -0.26% is +2.02% pre-market with oil, the largest energy weight in the S&P 500. Energy is the one sector with a reason to rise today. It is a small offset to tech and industrials

What Would Change The Read

Scoring Wednesday's calls. We asked whether the 10-year would close above 5.312%. It did not: it traded 5.368% intraday, then closed at 5.295% after the strong auction. We asked whether ES would hold Tuesday's 7,829.00-7,897.50 range. It did not: Wednesday's low was 7,815.75. We asked whether Brent would hold $100 into EIA. Just: it settled $100.20. We asked whether EUR/USD would test 1.1162. It has not: the 52-week low still stands
Whether the 10-year clears 5.368%. That is Wednesday's intraday high and the highest level since 2002. The 13:00 auction is the main test
Whether ES holds below Wednesday's low of 7,815.75. It is trading below it now. The overnight low is 7,802.75, and Wednesday's settle of 7,852.75 is near the overnight high
Whether Brent holds above $105 into the weekend. Isaias has not yet made landfall, and the strike report is a report, not a decision. Either could reverse quickly; neither has so far
Whether gold continues to separate from yields. If GC stays flat or higher as the 10-year rises, the war-risk bid is replacing the real-rate pattern of the past three sessions

The Bottom Line

Wednesday's pressure was rates alone. This morning it is rates and oil together, and they are making each other worse: a 5% jump in crude ahead of a Fed that is already signalling more hikes. The S&P has held up because a few very large stocks have held up, while the Dow, the Russell and mid caps have not. Claims at 08:30 are unlikely to settle anything. The 30-year auction at 13:00, and whether Brent holds above $105 into a hurricane weekend, are what the session hinges on.

_For informational purposes only. Not investment advice._