WS #12680

The dominant macro theme remains the US-Iran conflict and its impact on oil prices, but this window shows a notable counter-signal: oil prices fell sharply on Friday, with Brent crude settling at $96.78 (-3.88%) and WTI at $89.31 (-3.12%), as Houthi statements downplaying a full blockade of the Bab el-Mandeb strait provided some relief. However, the broader inflationary pressure from energy costs persists, with mortgage rates hitting their highest since August and gasoline prices spiking 15 cents in a week in some US regions. The tech selloff is escalating sharply: the Magnificent 7 lost $767 billion in market cap on Thursday, led by Tesla and Alphabet, as AI capex concerns dominate. Tesla missed earnings expectations badly (EPS $0.33 vs $0.51 est.) and Alphabet raised capex guidance to $205B, fueling skepticism about AI spending returns. Intel dropped 7.9% despite beating revenue estimates, as investors focused on increased capex. Trump escalated trade tensions by threatening a 301 investigation and substantial tariffs on the EU over fines on US tech giants (Google, Apple, Meta, Amazon). The EU sanctions package targeting a $120B Russian crypto network was also announced. SpaceX's Starship Flight 13 launched successfully, but a booster explosion during landing added volatility to SPCX stock. The ICC voted to remove Chief Prosecutor Karim Khan. Wildfires in Spain and France have forced 150,000 evacuations. The narrative arc is: Middle East conflict STABLE (oil easing as counter-signal), tech selloff ESCALATING, trade war ESCALATING (new EU tariff threat).