WS #13294

The dominant theme remains the US-Iran de-escalation, which is ESCALATING in complexity. Trump confirmed talks with Iran begin Monday, and Iran-Oman negotiations on a new Strait of Hormuz route are in final stages, but a tanker explosion near Khasab and continued UKMTO-reported attacks underscore that physical risks persist. Oil prices plunged over 6% (Brent to $82.41, WTI to $80.65) on the talks, but the physical attacks suggest the geopolitical premium may not fully unwind. OPEC+ approved a September production increase of 188,000 bpd, but this is largely 'paper' due to export disruptions, and the group may pause further hikes. The yen intervention story is now CONFIRMED and STABLE: Japan and the US jointly intervened on Friday, the first such action since 2011, with the yen strengthening to 155-156 per dollar; Japan may have sold Treasuries to fund it, and further intervention is threatened. In tech, the AI narrative is mixed: Amazon's strong earnings and Microsoft's Azure growth (43%) are bullish, but Korean chipmakers (Samsung, SK Hynix) fell ~9% on profit-taking, and Apple faces MacBook Air supply constraints due to memory shortage, with prices raised. The MAG7 narrative shows Amazon and Microsoft earnings calmed AI spending jitters, but Apple lagged on supply warnings. Overall, the market faces a mixed picture: oil de-escalation is bullish for consumers and airlines but bearish for energy, while yen intervention uncertainty and Apple supply issues add caution.