WS #12695

The dominant theme remains the escalating US-Iran conflict, now in its 14th day. A key development is the Houthi missile and drone attack on a Saudi Aramco oil refinery in Jeddah and Jizan, opening a second front in support of Iran. This directly threatens Saudi oil infrastructure and global supply, adding a significant risk premium to oil prices. The US has carried out 13 consecutive days of strikes, and Trump stated the US is 'locked and loaded' for escalation while also pursuing diplomacy. Iran's IRGC continues to stop vessels in the Strait of Hormuz. The conflict is depleting US missile inventories. Oil prices are elevated, and gas prices are rising in the US. The Russia-Ukraine conflict continues to impact energy markets, with Ukrainian drones striking the Tyumen oil refinery in western Siberia, over 2,000 km from the border, adding to Russian fuel supply disruptions. The Russian central bank cut its 2026 GDP growth forecast to 0.0-1.0% and expects 6-7% inflation due to fuel price increases from Ukrainian strikes on refineries. In tech, the aftermath of this week's earnings continues: Alphabet fell 7% on high capex, Intel surged 320% after the US government took a 9.9% equity stake, and Tesla dropped 14.5% on massive capex plans for robotaxis and Optimus. The S&P 500 is flashing sell signals, with options traders bracing for wild swings in Apple, Meta, and Microsoft. Trump threatened tariffs on Europe over fines on Apple and Google, and on Mexico over lettuce and Canada over wildfire smoke. China slapped export controls on 14 EU entities in retaliation for Russia-related sanctions. The NAVER-Brookfield-NVIDIA $10 billion AI factory expansion in Korea was announced. Bitcoin ETF weekly trading volume fell to its lowest since October 2024, while ether funds lead inflows. The US lowered its Section 301 tariff on Indian goods to 10% from 12.5%, exempting nearly half of India's exports. The US also announced a new 10% tariff on Canada, Mexico, and the UK over forced labor concerns, but most Canadian goods are exempt under CUSMA. The US Supreme Court defeat on tariffs has led the administration to employ new legal paths. Gold prices rose on geopolitical risks. The cyclospora outbreak in the US has sickened over 4,000, with a former FDA official calling the Trump administration's handling 'catastrophic'.