Finance

Australian shares lose $32 billion as oil prices rise

Markets now price a 75 per cent chance of a Reserve Bank rate rise in September after United States bond yields reached their highest level in three years.

Pedestrians pass the ASX market board at Exchange Square in Sydney

The ASX market board at Exchange Square, Sydney. Digitally illustrated image.

By Editor · 12 September 2026

By Fiona Sterling · 2026-09-11

TLDR

Australia's sharemarket lost A$32 billion on 10 September 2026, its worst session since June, after Brent crude crossed US$100 a barrel for the first time in months. Every sector closed lower, bond yields hit multi-year highs, and markets now price a 75 per cent chance of an RBA rate rise on 29 September.

KEY TAKEAWAYS

01The ASX 200 closed down 1.0 per cent at 8,819 points, erasing A$32 billion in market value.

02Brent crude hit US$101 intraday before closing at US$100.40, reigniting inflation fears globally.

03US 10-year Treasury yields reached 4.85 per cent, their highest level in three years.

04Nine Entertainment shares fell to a record low of 79 cents; BHP dropped 2.9 per cent to A$62.72.

05Markets now price a 75 per cent chance the RBA lifts rates at its 29 September meeting.

Every sector closed lower in the worst session since June

The S&P/ASX 200 finished at 8,819 points on Thursday, down 1.0 per cent, shedding A$32 billion in total market capitalisation after an intraday low that briefly wiped about A$50 billion.^[1] Energy, materials, financials and consumer stocks all closed in the red, with no sector spared.^[1]

The trigger was oil. Brent crude futures briefly crossed US$101 a barrel before settling at US$100.40, a level not seen in months, after reports of fresh attacks on oil infrastructure in the Gulf region.^[1] Justin Lin, Investment Strategist at Global X ETFs, said the move was landing squarely on local equities.

"Oil is really smashing the Australian market today," Lin said. "With Brent crude back above US$100 a barrel investors are being forced to confront the prospect that inflation could remain higher for longer and that the RBA may have more work to do."^[1]

Bond yields compound the pressure

US 10-year Treasury yields reached 4.85 per cent on the day, the highest in three years.^[2] German 10-year Bund yields rose to 3.39 per cent, a 17-year high, arriving alongside the oil spike to give equity markets two reasons to reprice downward at once.^[3] Higher yields reduce the present value of future corporate earnings, which is the mechanical reason share prices fell broadly.

Rate futures now assign a 75 per cent probability to an RBA rate rise at its 29 September board meeting, with markets also pricing a 63 per cent chance the US Federal Reserve tightens on 17 September.^[1] Justin Lin said the commodity sector faces a split outcome: mining stocks have benefited from higher metal prices, but sustained triple-digit oil could slow the global growth that underpins demand for industrial commodities. Lin said higher metal prices had been enormously supportive for the miners, but if US$100-plus oil reignites global inflation, forces central banks to tighten further and ultimately slows economic growth, demand for industrial commodities could begin to soften materially.^[1]

BHP and Nine lead individual losers

BHP Group fell 2.9 per cent to A$62.72 by 3pm AEST, reflecting the ambiguous position mining giants occupy when oil-driven inflation clouds the demand outlook.^[1] Nine Entertainment had a worse session, touching a record low of 79 cents after shedding as much as 6.5 per cent during the day.^[1]

For investors watching the September calendar, the RBA board meets on 29 September.

This article contains analysis and commentary on market conditions. It does not constitute financial, investment, or professional advice. Past performance is not indicative of future results. Always consult a qualified adviser before making financial decisions.

SOURCES & CITATIONS

FREQUENTLY ASKED QUESTIONS

Why did the ASX fall so sharply on 10 September 2026?

Brent crude oil crossed US$100 a barrel for the first time in months after reports of attacks on Gulf oil infrastructure. That reignited fears that inflation would stay elevated, pushing bond yields higher and increasing the probability markets attach to further central bank rate rises in both Australia and the United States.

What does a 75 per cent chance of an RBA rate rise mean for mortgage holders?

Rate futures pricing reflects what bond traders collectively expect, not a guarantee. A 75 per cent probability means markets lean strongly toward a rise on 29 September, but the RBA board makes the final call based on inflation and employment data available at the time. Mortgage holders on variable rates should check whether their budget can absorb another increase before the meeting.

Why did Nine Entertainment shares fall to a record low?

The research bundle confirms Nine fell as much as 6.5 per cent to a record low of 79 cents, but does not specify a company-specific cause beyond the broad market sell-off. Media stocks are sensitive to advertising revenue expectations, which tend to weaken when consumers face higher interest rates and energy costs.

Fiona Sterling

Fiona Sterling writes about superannuation, tax and personal finance. She takes rules that are written to be confusing and explains what they mean for the money in your account.