WS #12762

The dominant theme in this window is a significant escalation in Middle East energy risks, despite a temporary pause in US-Iran strikes. An oil tanker explosion in the Strait of Hormuz (attributed to a naval mine after deviating from Iran's designated route) and Houthi attacks on Saudi oil infrastructure are actively disrupting supply. Iran has also stopped six vessels and is asserting control over the Strait. This is a DE-ESCALATING US-Iran kinetic conflict but an ESCALATING energy supply crisis, as the Strait of Hormuz remains effectively contested. Separately, Alphabet reported its first-ever negative free cash flow as a public firm, raising serious concerns about AI spending sustainability across Big Tech. This is a high-significance negative for the tech sector, particularly for AI-heavy names. The NVIDIA-led $750B AI infrastructure deal (with Samsung, SK hynix, Broadcom) is a carry-forward positive for AI/semiconductors, but Alphabet's cash flow shock may overshadow it. The Berlin Pride attack has been officially classified as an Islamist terror attack by German authorities, adding to geopolitical unease but with limited direct market impact. The US-Iran pause is a counter-signal to the oil supply crisis, but the tanker explosion and Houthi attacks suggest the pause is fragile and supply risks remain elevated.