WS #13035

The US-Iran conflict continues to escalate with fresh US strikes on IRGC targets in Iran, following an attempted Iranian missile attack on US forces in Jordan. This marks a resumption of hostilities after a brief lull, with Trump vowing to 'hit them very hard.' Oil prices surged 7%+ on Wednesday (Brent near $90) but are giving back some gains in Asian trade (Brent -0.85% to $89.97, WTI -0.54% to $84.00) as alternative shipping routes through the Red Sea show increased traffic, partially offsetting supply fears. The Fed held rates steady (9-3 vote) but the 30-year yield hit 5.2%, steepening the curve and pressuring equities. Microsoft's strong earnings (Azure +43%, revenue $90B, EPS beat) drove after-hours gains of 7%+ for MSFT, providing a bullish counter-signal to the tech selloff. Meta disappointed (EPS miss, weak guidance, FCF collapse to $784M) with stock down 7%+ after-hours. Samsung Electronics reported record Q2 profit (KRW 89.5tn, +1,813% YoY) driven by AI memory demand, and announced multi-year supply contracts covering 60-70% of capacity, with customers requesting LTAs. A drone strike hit a US-owned LNG vessel at Egypt's Damietta Port, raising fears of conflict spillover into new energy hubs. The dominant narrative is ESCALATING US-Iran conflict driving oil and risk-off, but Microsoft's earnings and OPEC+ potential supply increase provide partial offsets. The Fed's lack of guidance on future rate hikes has led to bond market tightening, with JPMorgan pulling forward rate hike expectations to December 2026.