MARKET AT 7
Good evening. a real blowEvery part of tonight's newsletter traces back to one number: the US 10-year Treasury yield, which crossed 5% for the first time since 2007 as traders bet almost everything on the Federal Reserve raising rates within hours.
In tonight's newsletter:
Bond yields hit 2007 high as Fed nears first-rate hike since 2023
Brent tops $108 as Saudi Arabia halts loadings at Red Sea port
Wall Street falls a second day, but the ASX claws back some ground
Infratil hits a record high on AI-driven data centre demand
Bitcoin slides after US Senate blocks crypto market bill
Bond yields hit 2007 high as Fed nears first-rate hike since 2023
The US 10-year Treasury yield climbed above 5% for the first time in 19 years, touching 5.03% before easing slightly, as traders priced in a roughly 92-94% chance the Federal Reserve raises its benchmark rate a quarter point at Wednesday's meeting, CNBC and Bloomberg report. The decision lands at 2pm US Eastern time, which is around 3:30am Thursday in Adelaide, so nothing is confirmed yet tonight. A hike would lift the fed funds rate to 3.75-4%, the first increase since July 2023, and would come with an updated "dot plot" showing how many more moves officials expect this year. Source: CNBC, 15 Sep 2026 → · Source: Market Index, 16 Sep 2026 →
OUR TAKE:
A rate hike driven by an oil shock, not an overheating economy, is a strange kind of tightening to watch unfold. We'll know by breakfast whether Chair Warsh goes further than the quarter point everyone's already pricing in.
Brent tops $108 as Saudi Arabia halts loadings at Red Sea port
Brent crude traded near $108 a barrel on Wednesday after Saudi Aramco suspended oil loadings at Yanbu, its main Red Sea export terminal, shipping sources told Reuters and OilPrice.com. The suspension follows last week's drone strike on the kingdom's East-West pipeline, which normally carries 7 million barrels a day around the blocked Strait of Hormuz, and Riyadh has told European customers some late-September cargoes will be cancelled. Oil is up more than 8% this month as the standoff between the US and Iran keeps escalating. Source: OilPrice.com, 15 Sep 2026 → · Source: Trading Economics, 16 Sep 2026 →
OUR TAKE:
Losing the pipeline was bad. Losing the backup port that the pipeline feeds is worse, and it's the kind of detail that explains why oil keeps grinding higher even on days with no fresh attack.
Wall Street falls a second day, but the ASX claws back some ground
The Dow closed down 0.63% at 52,093.11 on Tuesday (the most recently completed US session, since Wall Street hadn't opened yet at this newsletter's Adelaide deadline), while the S&P 500 lost 0.45% and the Nasdaq dropped 0.78%, as rising yields and oil prices kept buyers away ahead of the Fed. The ASX 200 did the opposite on Wednesday, closing up around 0.2% near 8,691 points, clawing back some of Tuesday's slide to a near-10-week low of 8,673. Local traders are also pricing in an 80-90% chance that the Reserve Bank of Australia will hike at its own meeting on 29 September, according to CommBank and Trading Economics. Source: Trading Economics, 16 Sep 2026 → · Source: CommBank, 11 Aug 2026 →
OUR TAKE:
One green session doesn't undo a bad week. The ASX bounced because global sentiment steadied a little, not because anything here actually got better.
Infratil hits a record high on AI-driven data centre demand
Infratil, the NZX and ASX dual-listed infrastructure investor, jumped 4-5% to a fresh high on Wednesday after lifting its FY27 earnings guidance on the back of its CDC Data Centres business, interest.co.nz and Market Index report. CDC raised its own FY27 EBITDAF guidance to A$710-750 million after signing another 70 megawatts of contracts, bringing its total contracted capacity to 1.1 gigawatts. Data centre assets now make up just over half of Infratil's NZ$22 billion portfolio, and the company says demand is being driven squarely by AI.Data centre assets now account for just over half of Infratil's NZ$22 billion portfolio, and the company says AI is driving demand. Source: interest.co.nz, 16 Sep 2026 →
OUR TAKE:
Every AI story eventually turns into an electricity story. Infratil is one of the clearest examples in this part of the world of who actually cashes the cheque.
Bitcoin slides after US Senate blocks crypto market bill
Bitcoin fell about 2.8% to roughly $76,000 on Tuesday after the US Senate failed to advance the CLARITY Act, the crypto industry's marquee market-structure bill, falling 11 votes short of the 60 needed, Bloomberg and Decrypt report. Coinbase shares dropped 8.65%, and roughly $289 million in leveraged crypto positions were liquidated within the hour of the vote. With the midterm calendar closing in, the bill's chances for 2026 are effectively dead.
OUR TAKE:
This wasn't a generic risk-off wobble. It's a specific regulatory setback with a specific vote count attached, and crypto traders who'd priced in the bill passing got caught leaning the wrong way.
QUICK HITS
Gold falls to lowest since early August, near $4,288 an ounce. A stronger US dollar and near-5% Treasury yields have pulled gold away from safe-haven buying ahead of the Fed decision, Trading Economics data shows. Our take: gold usually loves uncertainty. This week, it's losing to the currency that uncertainty is supposed to hurt.
Fund managers trim their bullishness as bond fears build. A Bank of America survey found a net 49% of fund managers overweight global equities, down from 56% last month, with cash holdings rising to 3.9% of portfolios as a disorderly bond selloff becomes the biggest named tail risk. Our take: nobody's panicking yet. They're just quietly building a bigger exit.
RBA seen 80-90% likely to hike on 29 September, still two weeks out. Governor Michele Bullock has told parliament inflation risks sit on "both sides", while the Big Four banks are split on timing, with NAB tipping September and Westpac tipping no hike at all this year. Our take: that's not a call yet. That's four banks admitting they don't agree with each other.
Those are your 5 minutes for tonight; see you at the same time tomorrow. - Miko Santos