Updated September 11, 2026 — 1:04pm,first published September 11, 2026 — 5:23amInvestors have wiped about $90 billion off Australian shares in the past week, amid surging oil prices, rising bond yields and growing concerns about the risk of interest rate hikes.The benchmark S&P/ASX200 index closed 78.2 points, or 0.9 per cent lower on Friday, at 8741.2, losing 2.9 per cent over the past week.Oil climbed to its highest mark since March.APAMP deputy chief economist Diana Mousina said higher than expected inflation data in the past few weeks, commentary from central bank officials, and a rise in bond yields – which makes shares relatively less attractive for investors – were among the factors weighing down the Australian sharemarket.“The market has been in a bit of a dip since the beginning of August, but we’ve also started seeing more signs that the Reserve Bank might raise rates sooner than expected,” she said, noting markets are expecting a rate rise at the end of this month and 2.7 rate hikes by October next year.Earlier this week, RBA deputy governor Andrew Hauser appeared on the ABC’s 7.30 program where he struck a hawkish tone, warning that the bank will have to raise interest rates again if inflation proves stickier than currently expected.Mousina also pointed to the August NAB business survey results released this week that showed business conditions had dropped into negative territory for the first time in six years, and oil prices which have continued to rise on the back of escalating military conflict between the United States and Iran.“The energy sector has been doing relatively well all year, the financial sector has been alright, but technology and consumer companies have been lower,” she said.The energy sector was slightly down at the close on Friday as gains in Santos (up 0.7 per cent) were offset by steep drops for coal miner Whitehaven (down 2.7 per cent) and uranium stocks such as Paladin (down 9.6 per cent). However, the sector has gained 2.4 per cent over the past five days.Meanwhile, consumer discretionary companies have shed 4.7 per cent over the past five days and 15 per cent over the past month after lacklustre earnings results from retailer JB Hi-Fi during the earnings season and as rising interest rate expectations dampen consumer confidence.Westpac chief economist Luci Ellis said in a September market outlook report that the most significant development this month has been the broad rise in global bond yields amid renewed conflict in the Middle East, oil prices pushing new highs and central banks “actively contemplating” more rate rises.The strength in energy stocks and the rise in bond yields comes as Brent Crude hit four-month highs just below $US110 a barrel after Iran-aligned Houthis seized Yemen’s port city of Mocha overnight, giving them more power to disrupt tanker traffic through the Red Sea.“Unconfirmed reports were circulating this morning of multiple tankers being attacked near the Strait of Hormuz and that the Houthis may have scored a direct hit on Saudi Arabia’s East-West pipeline,” IG market analyst Tony Sycamore said.The pipeline, which can carry up to seven million barrels a day, has been a lifeline for the global economy since the war began.Making matters worse, inflation expectations and firming US producer prices sent bond yields to multi-year highs, narrowing bets the US Federal Reserve will hike the federal funds rate next week.Local mining stocks have been hit hard, with mining stocks down 3.6 per cent on Friday and 3.9 per cent over the past week as commodity prices suffered on multiple fronts.Copper dived more than 5 per cent from recent record highs amid US tariff uncertainty, iron ore futures fell on easing demand from China, while US interest rate worries hit precious metals.BHP shares slumped 4.1 per cent to $60.87 each, while Rio Tinto traded 3.5 per cent lower.Gold stocks were a sea of red as the precious metal sank 0.3 per cent to less than US$4400 ($A6135) an ounce.The financial sector softened the damage to the broader index, climbing 1.1 per cent as dip buyers bought up banks and major insurers.Suncorp (up 3.7 per cent), NAB (up 2.7 per cent) and ANZ (up 1.7 per cent) were among the best-performing large-cap companies on Friday, helping to buoy the financials sector. Insurers IAG (up 4.2 per cent) and QBE (up 2.9 per cent) were also stronger.In company news, GQG Partners crumpled by 9.5 per cent after its funds under management shrank $US4.3 billion to $US149.2 billion in August.The Australian dollar was buying 71.7 US cents when markets closed on Friday, down from 72.16 US cents on Thursday.With AAPThe Market Recap newsletter is a wrap of the day’s trading. Get it each weekday afternoon.Millie Muroi is the economics writer at The Sydney Morning Herald and The Age covering workplace and economics. She was formerly an economics correspondent based in Canberra’s Press Gallery and the banking writer based in Sydney.Connect via X or email.From our partners