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March 12, 2026 – 13:39

(Bloomberg) — Stocks fell as oil prices kept rising, with Iran stepping up attacks on neighboring states and causing widening disruptions to crude shipments. A gauge of global bonds erased its 2026 advance.

S&P 500 futures dropped 0.7%. Brent briefly jumped back above $100 a barrel as Iraq suspended oil terminal activity following an attack on two tankers. Oman temporarily evacuated a key export hub, while Iran launched strikes on targets in Dubai and Kuwait. The dollar remained the haven of choice, rising 0.2%.

The war in the Middle East is creating the biggest-ever disruption in oil markets, affecting 7.5% of global supply and an even greater portion of exports, the International Energy Agency said.

The surge in oil prices reflects concern that the conflict could throw energy markets into turmoil for a prolonged period, with efforts to cushion the impact offering little relief. Crude is driving moves across asset classes as traders fear that higher fuel costs will rekindle inflation and hit economic growth.

“What you’re seeing is the market pricing a long-lasting scenario of high oil prices,” said Karen Georges, an equity fund manager at Ecofi in Paris. “The security of shipping in the region is a big concern while the release of emergency oil reserves can only provide temporary relief.”

Bond yields in the UK and euro area followed their Asian counterparts higher. Treasuries posted muted gains, with the 10-year yield at 4.22%. Jobless claims were little changed from the prior week and came in just below expectations.

A Bloomberg index that tracks total returns from investment-grade government and corporate bonds is now flat for 2026. The gauge had been up as much as 2.1% this year through Feb. 27, just before the US and Israel attacked Iran.

Any sustained pickup in price pressures will make it harder for the Federal Reserve to justify resuming interest-rate cuts in coming months, with money markets seeing only one reduction for 2026.

For Francois Rimeu, senior strategist at Credit Mutuel Asset Management in Paris, the reaction in equity markets has been rather sanguine given how broad and impactful a worst-case scenario for the conflict could be.

“The draw-down could really turn much lower should the conflict last longer, and the longer it lasts, the longer a return to business as usual will be,” Rimeu said. “If you ask me when is the right time to buy back, I would tend to say when one actually sees ships crossing the Strait of Hormuz again.”

Mounting strain in the private credit market also weighed on sentiment as Morgan Stanley and Cliffwater LLC capped withdrawals from their multibillion-dollar private credit funds. The industry has been hit by a wave of redemption requests amid growing worries over the quality of loans.

What Bloomberg Strategists Say:

“It’s telling that despite the periodic equity-market rallies over the last few days, the SPX has yet to recapture the 6800-7000 range on a closing basis. One can’t help but wonder if the risk is that one of these days, the market will decline to bounce after a negative opening gap, and instead more forcefully embrace a more negative outlook.”

— Cameron Crise, Macro Strategist, Markets Live. Click here for the analysis.

European banks led declines in the regional market, with Deutsche Bank AG down 5.1% to extend its losses for the year to 22%. HSBC Holdings Plc fell 3.5%.

“The concerns over private credit, which emerged well before the US strikes on Iran, are adding to the negative mood despite the fact that European banks have little exposure on that asset class,” said Jerome Legras, head of research at Axiom Alternatives Investments.

Corporate News:

BMW AG sees little room for improving carmaking profitability this year due to tariffs and intensifying competition in China. Blue Owl Capital Inc. defended its recent sale of $1.4 billion of loans from three of its funds, arguing the transaction contained no backstops or hidden incentives. Airbnb Inc. is readying a possible debut high-grade debt offering as maturities approach on its existing convertible notes. JPMorgan Chase & Co. and UBS Group AG cut prime brokerage ties with the investment firm that was raided by authorities during a probe into alleged insider dealing in Hong Kong well before the investigation was made public, according to people familiar with the matter. Bumble Inc. rose 21% in premarket trading after unveiling a new AI-powered assistant designed to act as a personal matchmaker. Some of the main moves in markets:

Stocks

S&P 500 futures fell 0.7% as of 8:36 a.m. New York time Nasdaq 100 futures fell 0.7% Futures on the Dow Jones Industrial Average fell 0.8% The Stoxx Europe 600 fell 0.5% The MSCI World Index fell 0.2% Currencies

The Bloomberg Dollar Spot Index rose 0.2% The euro fell 0.3% to $1.1533 The British pound fell 0.3% to $1.3371 The Japanese yen was little changed at 158.91 per dollar Cryptocurrencies

Bitcoin fell 0.5% to $70,312.49 Ether fell 0.4% to $2,061.51 Bonds

The yield on 10-year Treasuries was little changed at 4.22% Germany’s 10-year yield advanced one basis point to 2.94% Britain’s 10-year yield advanced five basis points to 4.74% Commodities

West Texas Intermediate crude rose 6.8% to $93.21 a barrel Spot gold was little changed This story was produced with the assistance of Bloomberg Automation.

©2026 Bloomberg L.P.