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How Currency Markets React To The News
GO Markets
9/3/2021
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Every day currency markets are being bought and sold by institutions and banks and large speculators based on economic news announcements that are released. But why do currencies react strongly to some news announcement and not to others? Let me explain.

Financial institutions, banks and large speculators often have access to a Bloomberg or Reuters terminal which allows them to receive the latest economic data announcements instantly upon release. Meaning they will see the economic data before the average mum and dad investor ever gets to see it on a website and react. Mum and dad investors usually have to wait for a journalist to type the news up on a computer and then publish it online which can take minutes.

Institutions, banks and large currency speculators pay thousands of dollars a month to gain access to the economic data from Bloomberg because they know they will likely be first to see it and they can instantly trade the Forex market and get in and out before the balance of the currency herd. Gaining access to the news instantly is one thing, knowing whether to buy or sell the news is another thing entirely. As a general rule banks, institutions and large speculators will place their forex trades based on their interpretation of what “was expected” vs “what really happened.” Let me give you can example.

Let's say that at 11.30am the latest GDP growth numbers for Australia are due for release. Bloomberg, CNBC and other major financial news networks will have surveyed their favourite top economists and asked them for their consensus on what they think the GDP number will be. Bloomberg will come up with an average of all the economists and publish an “expected” GDP number on its terminal.

Let's assume that number is 2.1% but when the data is released the number comes in at 1.8%. This would immediately be seen as “out of line with expectation” and this is when banks, institutions and large speculators often trade and can move the forex market very swiftly. If the news came out and the GDP number was 2.1% as “expected” then it would be unlikely the same traders would bother trading the news event.

Those same traders before an economic data number is released will also be looking at the history books and thinking back to what happened previously when the data was out of line with expectations last time for this news event and they will also have a very good idea about how their colleagues in other banks will likely trade if the data number is “out of line with expectations.” So in a nutshell, the forex market reacts to economic data releases or comments made by Central Bank officials if the news is “in line” or “out of line” with expectations. Andrew Barnett | Director / Senior Currency Analyst Andrew Barnett is a regular Sky News Money Channel Guest and one Australia’s most awarded and respected financial experts, and is regularly contacted by the Australian Media for the latest on what is happening with the Australian Dollar. Connect with Andrew: Email

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GO Markets

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Central Banks
Why is the Federal Reserve independent, and why does it matter?

For over 110 years, the Federal Reserve (the Fed) has operated at a deliberate distance from the White House and Congress.

It is the only federal agency that doesn’t report to any single branch of government in the way most agencies do, and can implement policy without waiting for political approval.

These policies include interest rate decisions, adjusting the money supply, emergency lending to banks, capital reserve requirements for banks, and determining which financial institutions require heightened oversight.

The Fed can act independently on all these critical economic decisions and more.

But why does the US government enable this? And why is it that nearly every major economy has adopted a similar model for their central bank?

‍

The foundation of Fed independence: the panic of 1907

The Fed was established in 1913 following the Panic of 1907, a major financial crisis. It saw major banks collapse, the stock market drop nearly 50%, and credit markets freeze across the country.

At the time, the US had no central authority to inject liquidity into the banking system during emergencies or to prevent cascading bank failures from toppling the entire economy. 

J.P. Morgan personally orchestrated a bailout using his own fortune, highlighting just how fragile the US financial system had become.

The debate that followed revealed that while the US clearly needed a central bank, politicians were objectively seen as poorly positioned to run it.

Previous attempts at central banking had failed partly due to political interference. Presidents and Congress had used monetary policy to serve short-term political goals rather than long-term economic stability.

So it was decided that a stand-alone body responsible for making all major economic decisions would be created. Essentially, the Fed was created because politicians, who face elections and public pressure, couldn’t be relied upon to make unpopular decisions when needed for the long-term economy.

First Board of Governors of the Federal Reserve System | Museum of American Finance

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How does Fed independence work?

Although the Fed is designed to be an autonomous body, separate from political influence, it still has accountability to the US government (and thereby US voters). 

The President is responsible for appointing the Fed Chair and the seven Governors of the Federal Reserve Board, subject to confirmation by the Senate. 

Each Governor serves a 14-year term, and the Chair serves a four-year term. The Governors' terms are staggered to prevent any single administration from being able to change the entire board overnight.

Beyond this “main” board, there are twelve regional Federal Reserve Banks that operate across the country. Their presidents are appointed by private-sector boards and approved by the Fed's seven Governors. Five of these presidents vote on interest rates at any given time, alongside the seven Governors.

This creates a decentralised structure where no single person or political party can dictate monetary policy. Changing the Fed's direction requires consensus across multiple appointees from different administrations.

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The case for Fed independence: Nixon, Burns, and the inflation hangover

The strongest argument for keeping the Fed independent comes from Nixon’s time as president in the 1970s.

Nixon pressured Fed Chair Arthur Burns to keep interest rates low in the lead-up to the 1972 election. Burns complied, and Nixon won in a landslide. Over the next decade, unemployment and inflation both rose simultaneously (commonly referred to now as “stagflation”). 

By the late 1970s, inflation exceeded 13 per cent, Nixon was out of office, and it was time to appoint a new Fed chair.

That new Fed chair was Paul Volcker. And despite public and political pressure to bring down interest rates and reduce unemployment, he pushed the rate up to more than 19 per cent to try to break inflation. 

The decision triggered a brutal recession, with unemployment hitting nearly 11 per cent. 

But by the mid-1980s, inflation had dropped back into the low single digits. 

Pre-Volcker era inflation vs Volcker era inflation | FRED

Volcker stood firm where non-independent politicians would have backflipped in the face of plummeting poll numbers.

The “Volcker era” is now taught as a masterclass in why central banks need independence. The painful medicine worked because the Fed could withstand political backlash that would have broken a less autonomous institution.

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Are other central banks independent? 

Nearly every major developed economy has an independent central bank. The European Central Bank, Bank of Japan, Bank of England, Bank of Canada, and Reserve Bank of Australia all operate with similar autonomy from their governments as the Fed.

However, there are examples of developed nations that have moved away from independent central banks.

In Turkey, the president forced its central bank to maintain low rates even as inflation soared past 85 per cent. The decision served short-term political goals while devastating the purchasing power of everyday people.

Argentina's recurring economic crises have been exacerbated by monetary policy subordinated to political needs. Venezuela's hyperinflation accelerated after the government asserted greater control over its central bank.

The pattern tends to show that the more control the government has over monetary policy, the more the economy leans toward instability and higher inflation.

Independent central banks may not be perfect, but they have historically outperformed the alternative.

Turkey’s interest rates dropped in 2022 despite inflation skyrocketing

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Why do markets care about Fed independence?

Markets generally prefer predictability, and independent central banks make more predictable decisions.

Fed officials often outline how they plan to adjust policy and what their preferred data points are. 

Currently, the Consumer Price Index (CPI), Personal Consumption Expenditures (PCE) index, Bureau of Labor Statistics (BLS) monthly jobs reports, and quarterly GDP releases form expectations about the future path of interest rates.

This transparency and predictability help businesses map out investments, banks to set lending rates, and everyday people to plan major financial decisions.

When political influence infiltrates these decisions, it introduces uncertainty. Instead of following predictable patterns based on publicly released data, interest rates can shift based on electoral considerations or political preference, which makes long-term planning more difficult.

The markets react to this uncertainty through stock price volatility, potential bond yield rises, and fluctuating currency values.

‍

The enduring logic

The independence of the Federal Reserve is about recognising that stable money and sustainable growth require institutions capable of making unpopular decisions when economic fundamentals demand them.

Elections will always create pressure for easier monetary conditions. Inflation will always tempt policymakers to delay painful adjustments. And the political calendar will never align perfectly with economic cycles. 

Fed independence exists to navigate these eternal tensions, not perfectly, but better than political control has managed throughout history.

That's why this principle, forged in financial panics and refined through successive crises, remains central to how modern economies function. And it's why debates about central bank independence, whenever they arise, touch something fundamental about how democracies can maintain long-term prosperity.

GO Markets
•
February 4, 2026
Fundamental analysis
Market insights
Top 5 metals to watch in 2026

Gold's breakthrough above US$5,000 and silver's surge through US$100 signal this year could be one for the history books for metal traders (one way or another).

‍

Quick facts

  • Elevated safe-haven demand lifts Gold targets from US$5,400 to US$6,000 after early-year US$5,000 breakout.
  • Artificial intelligence (AI) and data-centre infrastructure ramp-up could help drive silver and copper demand.
  • Continued geopolitical uncertainty and shifting monetary policy could trigger metal volatility throughout the year.

‍

Top 5 metals to watch in 2026

1. Gold

Gold's breakout over US$5,100 arrived three quarters ahead of some forecasts. With Bank of America quickly raising its end-of-year target to US$6,000 and Goldman Sachs projecting US$5,400, the safe-haven commodity remains the biggest asset in focus for 2026.

Key drivers:

  • Central banks are currently buying an average of 60 tonnes of gold per month, compared to 17 tonnes pre-2022.
  • Two Fed rate cuts are priced in for 2026, reducing the opportunity cost of holding non-yielding assets like gold.
  • Trump tariff policies, Middle East tensions, and fiscal sustainability concerns are keeping safe-haven demand elevated.
  • Gold's share of total financial assets hit 2.8% in Q3 2025, with room to grow as retail FOMO kicks in.

What to watch

  • Jerome Powell is set to be replaced as Fed chair in May 2026. Actual policy direction post-replacement may differ from current market expectations for cuts.
  • If geopolitical hedges into safe havens remain or if there is an unwinding like post- 2024 US election.
  • The potential weaponisation of dollar asset holdings by European nations as a response to US tariffs.
XAUUSD chart by TradingView

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2. Silver

Silver is the metal that has benefited the most from the 2025 AI boom, with its surge to US$112 all-time-highs to kick off 2026 (70% above fundamental value as per Bank of America signal), demonstrating its volatile potential.

Key drivers

  • Industrial demand from AI infrastructure, solar, and electric vehicles (EVs), semiconductors and data centres currently has no viable substitute for silver's conductivity.
  • Six consecutive years of supply deficit, with above-ground stocks depleting and recycling bottlenecks limiting secondary supply.
  • Policy optics may matter. The US decision to add silver to its list of “critical minerals” has been cited as a potential factor in volatility, including around trade policy risk.
  • Retail participation can amplify price moves, particularly when the demand for gold becomes “too expensive”.

What to watch

  • If solar panel demand continues its trajectory, or if 2025 was the peak.
  • Whether the recycling supply responds to record prices by increasing silver refining and material processing capacity.
  • How exchange inventory and lease rates move as potential signals of physical tightness.
XAGUSD chart by TradingView

‍

3. Copper

Copper's 2026 story hinges on continued data centre demand, renewable energy infrastructure growth, and China's struggling property market.

Key drivers

  • Data centre copper consumption is projected to hit 475,000 tonnes in 2026, up 110,000 tonnes from 2025.
  • Worker strikes in Chile and Grasberg restart delays are keeping the Copper market structurally tight.
  • The US tariff decision on refined copper imports is expected in mid-2026 (15%+ currently anticipated), creating potential stockpiling and trade flow distortions.
  • Goldman Sachs has forecast that power grid infrastructure and EV buildout could add "another United States" worth of copper demand by 2030.
  • Current Chinese property weakness is creating demand uncertainty, potentially offsetting infrastructure spending.

What to watch

  • Whether Grasberg ramps production smoothly or faces further setbacks.
  • Chinese property market stimulus effectiveness.
  • Actual tariff implementation timing and magnitude.
  • Yangshan premium movements signalling real physical demand versus financial positioning.
Goldman Sachs forecasts copper prices to drop to $11,000 per tonne by the end of 2026

‍

4. Aluminium

Trading near three-year highs of US$3,200, aluminium faces continued tightness into 2026 as China's capacity ceiling forces global markets to adjust.

Key drivers

  • China's 45 million tonne capacity cap was reached in 2025. For the first time in decades, Chinese output cannot expand, potentially ending 80% of global supply growth.
  • As copper prices increase, Reuters has reported that some manufacturers have been substituting aluminium for copper in certain applications as relative prices shift.

What to watch

  • South32 has said Mozal Aluminium is expected to be placed on care and maintenance around 15 March 2026, thus removing Mozambique's 560,000 tonne significant supply.
  • If Indonesian and Chinese offshore capacity additions can compensate for Chinese domestic ceiling.
  • Century Aluminium's 50,000 tonne Mount Holly restart in Q2 could provide a signal for the broader industry as the smelter is expected to reach full production by 30 June 2026.
Projected 2026 Aluminium deficit after Mozal shutdown. Source: IAI, WBMS, ING Research

5. Platinum

Platinum's breakout above US$2,800 follows three consecutive years of supply deficit and increased adoption of hydrogen fuel cells (for which it is a vital component).

Key drivers

  • The World Platinum Investment Council (WPIC) has forecast a significant supply deficit of 850,000 ounces in 2026 which could drain inventories, with limited new production coming online.
  • WPIC forecasts 875,000 to 900,000 oz uptake by 2030 for heavy-duty trucks, buses, and green hydrogen electrolysers.
  • Palladium-to-platinum substitution in catalytic converters is increasing in EV production.

What to watch

  • Supply response from producers. Platreef and Bakubung are adding 150,000 oz, but production discipline could limit a broader ramp-up.
  • US tariffs on Russian palladium could create spillover demand for platinum in EV production.
  • The pace of hydrogen infrastructure investment and heavy-duty vehicle adoption rates in Europe, China, and US.
  • Chinese jewellery demand could come into play. Just a 1% substitution from gold could widen the platinum deficit by 10% of the global supply.
Projected hydrogen fuel cell growth 2025-2030

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GO Markets
•
January 29, 2026
Fundamental analysis
Index
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What is the ASX? Your complete guide to Australia's $2 trillion stock market

The Australian Securities Exchange (ASX) is one of the world's top 20 exchanges, hosting over 2,000 listed companies worth approximately $2 trillion.

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Quick Facts:

  • The ASX operates as Australia's primary stock exchange, combining market trading, clearinghouse operations, and trade and payment settlement.
  • It represents roughly 80% of the Australian equity market value through its flagship ASX 200 index.
  • 2,000+ companies and 300+ ETFs are listed on the exchange, spanning from mining giants to tech innovators.

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How does the ASX work?

The ASX combines three critical functions in one system.

As a market operator, it provides the electronic platform where buyers and sellers meet. Trading occurs through a sophisticated computer system that matches orders in milliseconds, replacing the traditional floor-based trading that once defined stock exchanges globally.

The exchange also acts as a clearinghouse, ensuring trades settle correctly. When you buy shares, the ASX guarantees the transaction completes, managing the transfer of securities and funds between parties.

Finally, it serves as a payments facilitator, processing the money flows that accompany each trade. This integrated approach reduces settlement risk and keeps the market running smoothly.

‍

What are ASX trading hours?

The ASX operates from 10:00am to 4:00pm Sydney time (AEST/AEDT) on business days, with a pre-open phase from 7:00am. 

Stocks open alphabetically in staggered intervals starting at 10:00am, followed by continuous trading until the closing auction at 4:00pm. 

The exchange observes Australian public holidays and adjusts for daylight saving time between October and April, which can affect coordination with international markets.

‍

ASX trading hours by time zone:
Phase Sydney (AEST) Tokyo (JST) London (BST) New York (EDT)
Pre-Open 7:00am - 10:00am 6:00am - 9:00am 10:00pm - 1:00am 5:00pm - 8:00pm*
Normal Trading 10:00am - 4:00pm 9:00am - 3:00pm 1:00am - 7:00am 8:00pm - 2:00am*
Closing Auction 4:00pm - 4:10pm 3:00pm - 3:10pm 7:00am - 7:10am 2:00am - 2:10am
*Previous day. Note: Times shown assume daylight saving time in effect (AEST/BST/EDT). Japan does not observe daylight saving. Time differences vary when regions switch between standard and daylight saving at different dates.

‍

Top ASX Indices

S&P/ASX 200

This is the exchange's flagship index. It tracks the 200 largest companies by market capitalisation and represents approximately 80% of Australia's equity market.

It serves as the primary benchmark for most investors and fund managers and is rebalanced quarterly to ensure it reflects the current market leaders.

ASX200 chart by TradingView

All Ordinaries Index

Commonly called the All Ords, this index covers the top 500 companies on the ASX. 

It provides broader market exposure than the S&P/ASX 200, capturing roughly 80-90% of total market value. 

XAO chart by TradingView

‍

The 11 ASX sectors

The ASX also breaks down into 11 sector-specific indices, allowing investors to track performance in areas like financials, materials, healthcare, and technology. 

These indices can help identify which parts of the Australian economy are strengthening or weakening.

ASX sector breakdown as of 31 December 2025. Source: S&P Global
  1. Financials dominates as the largest sector, driven by Commonwealth Bank, NAB, Westpac, and ANZ. These banking giants provide lending, wealth management, and insurance services across Australia.
  2. Materials ranks second, led by mining powerhouses BHP and Rio Tinto. This sector extracts and processes resources, including iron ore, coal, copper, and gold.
  3. Consumer Discretionary includes retailers, media companies, and hospitality groups that benefit when household spending rises.
  4. Industrials encompasses construction firms, airlines, and professional services businesses.
  5. Healthcare features companies like CSL, a global biotech leader, and Cochlear, which produces hearing implants.
  6. Real Estate features property developers and Real Estate Investment Trusts (REITs) that own and manage commercial and residential assets.
  7. Communication Services includes telecommunications providers like Telstra alongside media and entertainment companies.
  8. Energy tracks oil and gas producers (many renewable energy companies typically fall under utilities).
  9. Consumer Staples covers essential goods providers like supermarkets and food producers.
  10. Information Technology includes software developers and IT services firms.
  11. Utilities covers electricity, gas, and water suppliers, including renewable energy.

‍

ASX sector breakdown:
ASX Symbol Sector Top Stocks % of ASX 200
XFJ Financials CBA, NAB, ANZ 33.4%
XMJ Materials Orica, Amcor, BHP 23.2%
XDJ Consumer Discretionary Harvey Norman, Crown 7.4%
XNJ Industrials Qantas, Transurban 7.4%
XHJ Health Care ResMed, CSL and Cochlear  7.1%
XRE  Real Estate Mirvac, LendLease, Westfield 6.7%
XTJXIJ Communication Services Telstra, Airtasker 3.7%
XEJ  Energy  Santos, Woodside  3.6%
XSJ Consumer Staples Woolworths, Westfarmers 3.4%
XIJ Information Technology Dicker Data, Xero 2.5%
XUJ Utilities AGL, APA Group 1.4%
Data accurate as of 31 December 2025. Source: SP Global

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Top ASX companies

Three companies consistently lead the S&P/ASX 200 by market capitalisation.

Commonwealth Bank (Mkt cap: A$259 bln)

Commonwealth Bank holds the top position on the ASX as Australia's biggest lender. 

Founded in 1911 and fully privatised by 1996, CBA offers retail banking, business lending, wealth management, and insurance.

Its performance often signals the health of the domestic economy.

BHP Group (Mkt cap: A$241 bln)

BHP Group stands as the world's largest mining company. 

Its diversified portfolio spans iron ore, copper, coal, and nickel operations globally. 

It serves as a bellwether for Australian commodity markets.

CSL Limited (Mkt cap: A$182 bln)

CSL Limited leads the Australian healthcare sector as a global biotech firm. 

Established in 1916, CSL develops treatments for rare diseases and manufactures influenza vaccines. 

The company demonstrates Australian innovation competing on the world stage.

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ASX top 20 companies:

ASX Top 20 Companies by TradingView

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The ASX's role in Australia's economy

The ASX serves as a vital mechanism for capital formation in Australia. It tends to provide price signals that reflect market expectations. 

When share prices rise, it suggests optimism about economic conditions. Falling markets may indicate concerns about future growth.

Australian companies raise funds through initial public offerings and follow-on share sales on the ASX, using proceeds to expand operations, fund research, or pay down debt.

Investors in these shares benefit from potential capital gains and dividend income. Many Australians build retirement savings through superannuation funds that invest heavily in ASX-listed companies.

Employment in financial services also depends partly on a healthy stock market. Brokers, analysts, fund managers, and supporting roles exist because of active capital markets.

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Key takeaways

The ASX functions as a market operator, clearinghouse, and payments facilitator, providing the infrastructure that enables capital formation and supports retirement savings for millions of Australians.

Its flagship index, the S&P/ASX 200, tracks the 200 largest companies and captures about 80% of market capitalisation, while the All Ordinaries index covers the top 500. 

Financials and Materials dominate the exchange, led by Commonwealth Bank, BHP, and CSL, reflecting Australia's strength in banking and resources.

You can trade the S&P/ASX 200 Index CFD and over 230 ASX Share CFDs on GO Markets.

GO Markets
•
January 15, 2026
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Australian defence spending, defence procurement Australia, Austal Landing Craft Heavy, DroneShield counter-drone, EOS LAND 156, Codan defence communications, HighCom ADF support, ASX military stocks, sovereign capability Australia, naval shipbuilding ASX
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ASX defence stocks explained: 5 names to watch in 2026

ASX defence stocks are back on more watchlists and according to the Stockholm International Peace Research Institute (SIPRI), global military spending reached approximately US$2.718 trillion in 2024, up 9.4% in real terms.

Australia’s current defence settings are set out in the 2024 National Defence Strategy and related investment planning documents, which outline long-term capability funding priorities. Furthermore, Canberra has pointed to A$330 billion of capability investment through 2034, including added funding for surface combatants, preparedness, long-range strike and autonomous systems.

Here is the part most people miss: not all ASX defence stocks are the same trade. Some sit close to naval shipbuilding. Some are counter-drone names and some are smaller, higher-risk operators where one contract may matter much more than the market assumes.

Woman in Camouflage Uniform Working on Next Generation Drone. Female Soldier Installing Electronic Parts Into Surveillance Drone. Concept of Advanced Military Research and Development. Top View.
Source: Adobe Stock
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These five names are not a buy list, rather they are a practical watchlist for investors trying to understand where procurement momentum may actually show up on the ASX.

1) Austal (ASX: ASB)

Austal is one of the ASX-listed companies most directly exposed to Australia’s naval shipbuilding pipeline, although contract execution, margins and delivery timing remain important variables.

They aren't just winning random contracts; they have signed a massive legal agreement (the Strategic Shipbuilding Agreement) that makes them the official partner for building Australia's next generation of mid-sized military ships in Western Australia.

In February 2026, the government gave Austal the green light on a $4 billion project. This isn't for just one ship, it’s for 8 "Landing Craft Heavy" vessels. These are huge transport ships (about 100 metres long) designed to carry heavy tanks and equipment directly onto a beach. But here is the part most people miss, shipbuilding is a marathon, not a sprint.

As you can see in the delivery timeline, while construction starts in 2026, the final ship won't be delivered until 2038. For an investor, this means Austal has a "guaranteed" stream of income for the next 12 years, but they have to be very good at managing their costs over that long period to actually make a profit.

2) DroneShield (ASX: DRO)

If you have seen footage of small drones disrupting modern battlefields, DroneShield is building part of the "off switch". Its focus is counter-drone technology, including systems that detect, disrupt or defeat drones using electronic warfare, sensors and software-led tools, rather than relying only on traditional munitions.

By early 2026, DroneShield had moved beyond the label of a promising start-up and into a much larger commercial phase. It reported FY2025 revenue of A$216.5 million, up 276% from FY2024, and said it started FY2026 with A$103.5 million in committed revenue.

One point the market may overlook is the software layer in the model. DroneShield reported A$11.6 million in Software as a Service (SaaS) revenue in FY2025 and said it is working towards SaaS making up 30% of revenue within five years. Its subscription model includes software updates for deployed systems, which adds a growing stream of recurring revenue alongside hardware sales.

Among ASX defence stocks, DroneShield is one of the most direct ways to follow the counter-UAS theme. It is also one of the names where sentiment can swing quickly, because growth stories can rerate both up and down when order timing changes.

The defence stocks to watch: The Iran War winners & losers

3) Electro Optic Systems (ASX: EOS)

EOS builds both the "brain" and the "muscle" for military platforms. It is best known for remote weapon systems, which allow operators to control armed turrets from inside protected vehicles, and for high-energy laser systems aimed at counter-drone defence. EOS has said its unconditional backlog reached about A$459.1 million in early 2026, following a series of contract wins through 2025. That points to a much larger base of secured work, although delivery timing and revenue conversion still matter.

EOS signed a €71.4 million, about A$125 million, contract with a European customer for a 100-kilowatt high-energy laser weapon system. EOS says the system is designed for a low cost per shot and can engage up to 20 drones a minute. The Australian Government has set aside A$1.3 billion over 10 years for counter-drone capability acquisition, and EOS has disclosed that it was part of a successful LAND 156 bid team. That does not guarantee future revenue, but it does support medium-term visibility in a market the company is already targeting.

EOS reads as a rebound story, but one that still depends on execution. The company has reoriented around remote weapon systems, counter-drone systems and lasers, all areas tied to stronger defence spending. The key question is whether it can keep converting backlog and pipeline into delivered revenue while maintaining balance-sheet discipline.

4) Codan (ASX: CDA)

Codan is sometimes left out of casual defence stock lists because it is more diversified. That may be an oversight. In its H1 FY26 results, Codan said its Communications business designs mission-critical communications for global military and public safety markets. Communications revenue rose 19% to A$221.8 million. The company also said DTC delivered strong growth from defence and unmanned systems demand, with unmanned systems revenue up 68% to A$73 million. Codan said about half of that unmanned revenue was linked to operational defence applications in conflict zones.

This is where the story becomes more nuanced. In a basket of ASX defence stocks, Codan may offer a different profile, with less pure headline sensitivity, broader operating diversification and meaningful exposure to military communications and unmanned systems without being a single-theme name. That diversification may also mean the stock does not always trade like a pure-play defence name.

What rising oil prices could mean for Exxon, Chevron and Woodside

5) HighCom (ASX: HCL)

HighCom sits at the speculative end of this list, and it should be labelled that way. The company says its two continuing businesses are HighCom Armor, which supplies ballistic protection, and HighCom Technology, which supplies and maintains small and medium uncrewed aerial systems, counter-uncrewed aerial systems, and related engineering, integration, maintenance and logistics support for the ADF and other aligned regional militaries.

In H1 FY26, revenue from continuing operations fell 59% to A$10.9 million, while EBITDA moved to a A$5.4 million loss from a A$1.9 million profit a year earlier. HighCom also disclosed A$5.1 million in HighCom Technology revenue, including A$3.5 million from small uncrewed aerial systems (SUAS) spare parts and A$1.6 million from sustainment services provided to the Australian Department of Defence.

So yes, HighCom is one of the more financially sensitive ASX defence stocks on the board. But it is also the kind of smaller name that can show how procurement filters down into support, sustainment and specialist protection gear.

Key market observations

  • Track program milestones, not just political headlines. Contract awards, manufacturing starts, delivery schedules and sustainment work often matter more than a single announcement day.
  • Separate pure-play exposure from diversified exposure. DroneShield and EOS are closer to concentrated defence technology themes, while Codan brings communications exposure within a broader business mix.
  • Watch sovereign capability themes in Australia. Austal and EOS are tied to local manufacturing, integration and Australian supply chains, which supports the broader sovereign capability theme in this group.
  • Pay attention to balance sheets and cash conversion. Procurement momentum can be real even when timing gets messy. HighCom's latest half is a reminder of that.
Global volatility and CFDs: how to trade after a geopolitics shock

Risks and constraints

Defence headlines can look immediate. Earnings usually are not. Austal's major naval work stretches into the next decade. EOS contracts are delivered over multiple years. DroneShield's order flow appears strong, but the company still separates committed revenue from broader pipeline opportunity. HighCom shows the other side of the coin. Exposure to procurement does not automatically translate into smooth financial execution.

References to ASX-listed defence stocks are general information only, not a recommendation to buy, sell or hold any security or CFD. These stocks can be highly volatile and are sensitive to contract timing, government policy, geopolitics, execution risk and market conditions. Backlog, pipeline and revenue expectations are not guarantees of future performance.

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GO Markets
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March 16, 2026
Market insights
Week ahead
This week could decide the 2026 macro narrative | GO Markets week ahead

Three central banks are deciding rates simultaneously, Brent crude is swinging wildly around US$100 a barrel, and a war in the Middle East is rewriting the inflation outlook in real time. Whatever happens this week could set the tone for markets for the rest of 2026.

‍

Quick facts

  • The Reserve Bank of Australia (RBA) announces its next cash rate decision on Tuesday, with markets now pricing a 66% chance of a second hike to 4.1%.
  • Some analysts have warned the Iran war could push US inflation to 3.5% by year-end and delay Fed rate cuts until September, making this week's FOMC dot plot the most closely watched in years.
  • Brent crude is flirting with US$100 a barrel after Iran launched what state media described as its "most intense operation since the beginning of the war."

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RBA: Will Australia hike again?

The RBA raised the cash rate for the first time in two years to 3.85% at its February meeting after inflation picked up materially in the second half of 2025. 

The question now is whether it moves again before even seeing the next quarterly CPI print, which isn't due until 29 April.

Deputy Governor Andrew Hauser acknowledged ahead of the meeting that policymakers face a genuinely divided decision, shaped by conflicting economic signals at home and growing instability abroad. 

Financial markets currently assign around a 66% probability to another hike, with a May increase considered virtually certain regardless of what happens Monday.

Key dates

  • RBA Cash Rate Decision: Tuesday 17 March, 2:30 pm AEDT
  • Governor Bullock press conference: Tuesday 17 March, 3:30 pm AEDT

Monitor

  • Any reference from Bullock to further hikes being likely in May
  • AUD/USD immediate reaction.
  • ASX banks and REITs.
Source: ASX RBA rate tracker

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FOMC: Hold likely, all eyes on the dot plot

The FOMC meets on March 17–18, with the policy statement scheduled for 2:00 pm ET on March 18 and Chair Jerome Powell's press conference at 2:30 pm. CME FedWatch shows a 99% probability that the Fed holds rates at 3.50% to 3.75%. 

The real action is in the Summary of Economic Projections (SEP) and dot plot. The current median dot shows one 25-basis-point cut for 2026. If it shifts to two cuts, that is dovish and bullish for risk assets. If it shifts to zero cuts or adds a rate hike into the projection, markets could react in the other direction.

Further complicating matters, Powell's term as Federal Reserve Chair expires on May 23, 2026. Kevin Warsh is the leading candidate to replace him, viewed as more hawkish on monetary policy. Any comment from Powell on this transition could move markets independently of the rate decision itself.

Key Date

  • FOMC Rate Decision + SEP/Dot Plot: Thursday 19 March, 4:00 am AEDT
  • Powell press conference: Thursday 19 March, 4:30 am AEDT

Monitor

  • Powell's language on oil and tariff inflation.
  • 2-year Treasury yield reaction.
  • CME FedWatch repricing for any shift in the September cut probability.
Source: CME FedWatch

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Bank of Japan: Further tightening could be brought forward

The BOJ meets on March 18–19, with the decision expected Thursday morning Tokyo time. The current policy rate sits at 0.75% (a 30-year high), and the January 2026 meeting produced a hold in an 8-1 vote.

Governor Ueda has categorised the March meeting as "live," noting the timeline for further tightening could be "brought forward" if Shunto spring wage negotiations yield stronger-than-expected results. 

Those results are due to begin flowing in during the week, making them the critical input for the BOJ's decision. Nomura expects 2026 Shunto wage hikes to come in around 5.0%, including seniority, with base pay growth of approximately 3.4%. If results confirm that trajectory, the case for a March hike strengthens considerably.

The complication is the global backdrop. Japan imports roughly 90% of its energy needs, and oil around US$100 per barrel is pushing up import costs and threatening to add inflationary pressure. A BOJ hike into a global oil shock would be an unusually bold move. 

Most market participants still lean toward a hold at this meeting, with April or July seen as the more likely timing for the next move.

Key Date

  • BOJ Policy Rate Decision (currently 0.75%): Thursday 19 March, morning AEDT

Monitor

  • Shunto wage results as the primary trigger for a March hike.
  • Ueda press conference language and forward guidance on April and July.
  • USD/JPY reaction.
Source: Trading Economics

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Oil: Continued volatility

Brent crude briefly touched US$119.50 per barrel earlier in the week before dropping 17% to below US$80, then rebounding toward US$95 on mixed signals from Washington about the Strait of Hormuz. 

As of Thursday, Brent was back over US$100 as Iran launched fresh attacks on commercial shipping and the IEA reserve release failed to bring meaningful relief.

In the scenario where a longer conflict inflicts damage to energy infrastructure, analysts estimate CPI could rise to 3.5% by the end of 2026, with gasoline prices approaching US$5 per gallon in the second quarter.

For this week, oil acts as a macro meta-variable. Every geopolitical headline, ceasefire signal, tanker attack, reserve release, and Trump comment could move equities, bonds and currencies in real time.

Monitor

  • Any resumed Strait of Hormuz tanker flow.
  • IEA emergency reserve release.
  • Trump statements on Iran.
  • Energy sector equities.

7 global commodity stocks to watch as the Iran war reshapes markets

GO Markets
•
March 13, 2026
Market insights
Commodity
7 global commodity stocks to watch as the Iran war reshapes markets

US-Israeli strikes on Iran launched on 28 February sent Brent crude surging past US$119 a barrel, gold above US$5,200, and defence stocks to all-time highs.

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Against that backdrop, investors are focusing on a small group of commodity-linked names that may remain sensitive to further moves in oil, LNG and gold. The key question is whether the shock proves sustained, or whether a ceasefire, shipping normalisation, or policy action removes part of the geopolitical risk premium.

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1. ExxonMobil (NYSE: XOM)

ExxonMobil has been one of the clearest beneficiaries of the price surge. Shares hit a record high of US$159.60 in early March and are up approximately 28% year-to-date. 

The company produces 4.7 million barrels of oil equivalent per day, has a Permian Basin breakeven of around US$35/barrel, and is committed to US$20 billion in buybacks for 2026.

Wells Fargo raised its price target to US$183 from US$156 following the escalation, while broader analyst consensus sits around US$140–$144. However, XOM is already trading above many consensus targets, and disruption to its LNG partner QatarEnergy poses a near-term operational headwind.

What to watch

  • Whether Hormuz disruptions persist beyond 4–6 weeks.
  • A G7 emergency stockpile release or a credible ceasefire could compress the war risk premium.
  • Any adjustments to analyst consensus targets.

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What rising oil prices mean for Exxon

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2. Chevron (NYSE: CVX)

Chevron touched a new 52-week high of US$196.76 in early March and has risen approximately 24% year-to-date. 

The company's Brent breakeven for dividends and capital expenditure sits around US$50/barrel. This means that at current Oil prices above US$90, it is generating significant free cash flow.

However, Chevron has temporarily halted operations at a gas field off Israel's coast following missile activity in the region, and the stock has since pulled back more than 1% as the conflict directly affects its operations.

What to watch

  • Direct operational updates from Chevron's Middle East and Israeli assets.
  • Any further halts that could weigh on near-term production. 
  • Crude holding above US$90, which keeps Chevron generating significant free cash flow.

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3. Woodside Energy (ASX: WDS/NYSE: WDS)

With Qatar having halted output after Iranian drone strikes, buyers across Asia and Europe are scrambling for alternative supply. Woodside, as one of Australia's largest LNG producers and exporters, sits outside the conflict zone and is well-positioned to benefit from rerouted demand.

Analysts caution that actual substitution takes time due to shipping and contract constraints, meaning the price uplift may be more durable than a simple spot trade. European TTF benchmark gas prices surged over 50% in a week, amplifying the margin environment for non-Middle Eastern LNG producers.

What to watch

  • The pace and timeline of any Qatar LNG production restart.
  • If QatarEnergy remains offline for weeks, Woodside could begin re-contracting European buyers at elevated spot prices.
  • An Australian dollar move higher could be a headwind worth tracking for USD-denominated earnings.

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4. Cheniere Energy (NYSE: LNG)

Alongside Woodside, Cheniere is the most direct US beneficiary of the Qatar LNG disruption. As the largest LNG exporter in the United States, it saw intraday strength at the start of the conflict week. 

US domestic energy production has buffered American consumers from the worst of the shock, but the export premium has widened as European and Asian buyers pay up for non-Gulf supply.

The trade is "geopolitically sensitive," and any resolution could reverse upside quickly. But for as long as Hormuz and Gulf gas infrastructure remain compromised, Cheniere is positioned to benefit structurally.

What to watch

  • Any diplomatic breakthrough that reopens Gulf shipping lanes. 
  • Announcements of new long-term offtake contracts signed at current elevated prices.
Statistic: Countries with largest liquefied natural gas (LNG) export capacity in operation worldwide as of September 2025 (in million metric tons per year) | Statista
Find more statistics at  Statista

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5. Newmont Corporation (NYSE: NEM)

Gold surged 5.2% in a single session on 1 March, touching US$5,246/oz, as markets sought safe-haven assets. Newmont, the world's largest gold producer, has seen its reserves effectively revalued at these prices. 

It is up alongside gold's 24% year-to-date gain, and its all-in sustaining costs remain largely fixed.

However, Gold miners sold off sharply on 4 March, and Newmont fell nearly 8% in a single session as broader risk-off deleveraging hit precious metals equities. 

The stock has recovered since, but volatility remains high. For longer-duration investors, analysts note that "safe" mining jurisdictions such as Canada, Australia, and Nevada are commanding fresh premiums as Middle East instability raises the value of geopolitically secure supply.

What to watch

  • Whether gold can hold above US$5,000/oz. 
  • A prolonged conflict could accelerate an M&A cycle in junior gold miners. 
  • A ceasefire or broad equity deleveraging event as the primary risk to monitor.
UUSD 1-day chart | TradingView

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6. Lockheed Martin (NYSE: LMT)

Lockheed Martin reached a new all-time high of US$676.70 on 3 March, up over 4% for the day. Its F-35 fighters, precision-guided munitions, THAAD systems, and HIMARS rocket artillery are central to the ongoing air campaign. 

The US Department of Defence is moving to replenish munitions stockpiles, and Trump's stated ambition to raise the US defence budget to US$1.5 trillion by 2027 adds a longer-term structural tailwind beyond the immediate conflict.

Defence stocks are rising amid classic geopolitical risk pricing, but investors should note that actual contract flow takes time to translate into earnings, and valuations already reflect considerable optimism. 

What to watch

  • The pace of US Department of Defence munitions replenishment orders.
  • How quickly contract wins translate into backlog growth.

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Top defence stocks to watch: Iran winners and losers

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7. Barrick Gold (NYSE: GOLD)

Barrick is tracking gold's historic run alongside Newmont, with the stock up sharply year-to-date. It sits at a roughly US$78 billion market capitalisation and is reporting record free cash flow projections as its all-in sustaining costs remain well below current spot prices. 

Like Newmont, it experienced a sharp single-session selloff of more than 8% during the broader 4 March deleveraging event, before partially recovering.

Royalty and streaming companies such as Wheaton Precious Metals (WPM) are being favoured by some investors as a more inflation-protected way to access gold upside, given their lower operational cost exposure. But Barrick remains one of the world’s largest listed gold miners, with earnings that are highly sensitive to changes in the gold price

What to watch

  • Gold's ability to hold above US$5,000/oz. 
  • Any Barrick moves toward junior miner acquisitions.
  • Energy cost inflation, as rising fuel prices could begin to squeeze miner operating margins.
GO Markets
•
March 13, 2026
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