WS #12824

Markets opened sharply higher as oil prices tumbled on the US-Iran ceasefire pause, but the relief rally is fragile. Multiple sources corroborate that Iranian-backed groups launched drones targeting Saudi oil facilities, including the Abqaiq refinery, and satellite imagery shows smoke/fire at the site. This counters the ceasefire narrative and could reverse the oil price decline. Separately, China's mass production of homegrown DUV chipmaking tools is a significant negative for US semiconductor equipment makers (ASML, AMAT, LRCX). Nvidia's credit risk jumped in swaps market on AI deal talk reports, while the company formed a 37-member AI security alliance excluding OpenAI, Anthropic, and Google. Deutsche Bank lowered TSLA price target to $420 from $465, citing slower Robotaxi and Optimus scaling. Piper Sandler upgraded RIVN to Overweight with $20 target. Amazon Leo proposed 5,105 satellites for direct-to-device service. The Fed's new chairman faces his biggest test this week with FOMC decision Wednesday. Overall, the oil-driven rally is being challenged by ongoing attacks on Saudi infrastructure, and the China chip breakthrough pressures US semis.