Oil and interest rates calling the shots

Briefing.com Summary:

*Oil prices had been higher, but they have reversed course.

*Treasury yields continue to perk up on inflation concerns and a pushing out of rate-cut expectations.

*Today is a quarterly expiration day for options and futures.

These days, if you want to get a line on the equity futures trade, you can start with oil prices, and then you can look at Treasury yields. Those two items pretty much set the tone.

Currently, the S&P 500 futures are down 27 points and are trading 0.4% below fair value, the Nasdaq 100 futures are down 127 points and are trading 0.5% below fair value, and the Dow Jones Industrial Average futures are down 176 points and are trading 0.3% below fair value.

What one might reasonably extrapolate from these indications is that oil prices are up and Treasury yields are higher. That isn’t precisely the case. 

Oil prices had been higher amid reports that a Kuwait refinery had been hit by a drone attack and that President Trump is considering occupying Kharg Island. WTI crude futures skimmed $97.00/bbl, and Brent crude futures hit $111.00/bbl, but now they are at $95.24, down 0.9%, and $106.98, down 1.5%, respectively. The reversal helped the equity index futures pare larger losses, but it didn’t succeed in cutting the losses entirely.

The other component—Treasury yields—hasn’t fallen into line. The 2-yr note yield is up four basis points to 3.87%, and the 10-yr note yield is up two basis points to 4.30%.

There is the phantom menace, too, known as the weekend, when markets are mostly shuttered and anything can happen militarily. Accordingly, there isn’t much conviction among buyers—not in a broad market sense anyway.

FedEx (FDX) is up nicely following its better-than-expected earnings results, yet the weight of the uncertainty about the war with Iran is drowning out positive news elsewhere on this quarterly options and futures expiration day.

The latter will result in heavy volume and perhaps some added volatility, but for now, the direction of travel for oil prices and Treasury yields will be calling the shots.

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Originally Posted March 20, 2026 – Oil and interest rates calling the shots