March 11 US Stock Market Recap

Today's core keyword for the market is only one: repeated uncertainty.

Due to signals of easing released in the previous trading session, market sentiment briefly warmed up, but then the situation became volatile again. Tensions in the Middle East have not truly cooled down, and rumors about maritime route security have once again raised concerns about energy supply. What the market is truly worried about is not a single negative factor, but whether risks will continue to escalate, which directly pushes up risk premiums.

Before the market opened, the International Energy Agency (IEA) proposed a possible large-scale release of strategic petroleum reserves, temporarily easing inflation expectations and driving the indices to open higher. However, capital soon realized that reserve releases can only alleviate short-term supply pressure and are difficult to hedge against long-term supply-demand imbalances. If the situation remains volatile, energy prices may still maintain high volatility. Therefore, the indices retreated after the initial surge, essentially reflecting a reassessment of the persistence of risks.

In terms of inflation, the February CPI was up 2.4% year-on-year, in line with expectations, and the data itself is relatively neutral. However, this data reflects the price structure before the recent energy volatility. Brent crude oil has experienced sharp fluctuations recently, briefly touching $120 during the session before falling back to around $90. The market is beginning to worry whether inflation will be affected by energy and resurge in the coming months, creating "secondary inflation" pressure.

For tech stocks, the issue is not the current CPI, but whether the interest rate path will change as a result. If energy prices push up inflation expectations, the Federal Reserve may maintain high interest rates for a longer period, and the pace of easing may also be delayed. With the interest rate center not yet clear, the room for valuation expansion in growth stocks is limited.

Interest rate expectations are being repriced. As energy disruptions intensify, market bets on rate cuts within the year have shrunk, and the current preference leans towards only one possible rate cut. Some even mention the combined risk of "slowing growth + high inflation." In this context of limited policy space, risk assets naturally face pressure. The 10-year US Treasury yield rose to 4.17%, suppressing both the tech and financial sectors.

There are still bright spots at the individual stock level. Oracle's earnings exceeded expectations, with strong demand for AI infrastructure, and its stock surged over 10% during the session. This indicates that capital has not completely withdrawn from risk assets. As long as earnings certainty is high enough, the market is still willing to grant a premium, and the logic of AI-related capital expenditure remains attractive.

However, the energy sector saw profit-taking after the oil price retreated, and financial stocks were also affected by both rising yields and economic uncertainty. Overall, the market has not formed a unified main theme, but risk appetite has become more cautious.

In summary, today's surge and retreat was not accidental but reflects the market reassessing "whether the oil price shock will change the inflation and interest rate path." A short-term transmission chain has formed: rising oil prices → heating inflation expectations → delayed rate cuts → index pressure. As long as this logic remains unbroken, the room for a sustained rebound at the index level is limited.

Currently, it seems more like a game stage driven by variables rather than a trend market. Whether oil prices stabilize will become a key observation point for the market going forward.

$Oracle(ORCL.US)