Index Update: The S&P/ASX 200 closed lower on Thursday, falling 114.50 points (1.31%) to 8,629.00, as oil prices moved above US$100 per barrel following an attack on two tankers in Iraqi waters and vessel evacuations from an export terminal in Oman. The index has declined 3.48% over the past five days and is largely unchanged year to date. Ten of eleven sectors closed lower, while energy was the only sector to rise, gaining 2.08% on the day and 1.35% over five days amid oil price concerns linked to the escalating Iran war.

Macro Update: Oil prices climbed to US$100 per barrel as tensions in the Middle East intensified, with Iran accused of setting fire to two tankers in Iraqi waters and increasing attacks on oil and transport facilities across the region. Reports indicated uncertainty over whether India-flagged tankers would be allowed to pass through the Strait of Hormuz, a key route for global crude shipments. The developments follow tensions involving United States and Israel, with the strait becoming central to disruptions in Middle Eastern oil flows.

Top Market Movers: Among gainers, Yancoal Australia Limited (ASX:YAL) rose AUD 0.73 (10.46%) to AUD 7.71, while Whitehaven Coal Limited (ASX:WHC) gained AUD 0.58 (6.66%) to AUD 9.29. Karoon Energy Ltd (ASX:KAR) increased AUD 0.09 (4.76%) to AUD 1.98. Among decliners, IperionX Limited (ASX:IPX) fell AUD 1.02 (14.29%) to AUD 6.12, while SiteMinder Limited (ASX:SDR) and Catapult Sports Ltd (ASX:CAT) declined 8.14% and 7.80% to AUD 3.16 and AUD 3.43, respectively.

Commodity Update: The U.S. dollar remained near its strongest level of the year on Thursday as rising crude oil prices heightened global inflation concerns and strengthened expectations of tighter monetary policy from central banks. Commodity markets showed mixed performance, with gold declining 0.38% to USD 5,158.30, silver dropping 0.65% to USD 85.00, and copper slipping 0.35% to USD 12,966.55. Meanwhile, Brent crude surged 5.69% to USD 97.67 after reports that Iranian explosive boats struck two fuel tankers.

Our Stance: The S&P/ASX 200 closed lower, falling 1.31% to 8,629.00, as oil prices moved above US$100 per barrel following tanker attacks linked to tensions involving Iran in the Middle East. Most sectors declined, while energy stocks such as Yancoal Australia Limited (ASX:YAL) and Whitehaven Coal Limited (ASX:WHC) advanced. Commodity markets were mixed as the U.S. dollar remained firm amid inflation concerns. In our view, markets may remain volatile in the near term as geopolitical developments and energy price movements continue to influence investor sentiment. 

In its latest trading session, the S&P/ASX 200 declined by 114.50 points, forming a bearish candlestick pattern on increased trading volume. The rise in volume alongside the decline reflects growing investor caution and highlights the presence of short-term weakness in market sentiment. Technically, the index continues to trade below its 21-period Simple Moving Average (SMA) on the daily chart, which is currently acting as an important near-term resistance level. This suggests that upside momentum remains limited unless the index manages to reclaim this technical barrier. On the downside, immediate support is placed around the 8,500 level. Holding above this support zone will be crucial to stabilise sentiment and prevent the possibility of a deeper corrective move in the near term.