WS #13424

The dominant market theme is a broad risk-on rally driven by strong AI-related earnings and easing oil prices on Hormuz de-escalation hopes. The S&P 500 hit a record high (+1.79%), Dow +1.71%, Nasdaq +2.59%, with Palantir surging 29.5% on a blowout quarter and Caterpillar +5.6% on record sales. Brent crude fell ~5% to ~$79 on reports that a US-Iran deal to reopen the Strait of Hormuz is close, with Treasury Secretary Bessent suggesting an agreement could come 'today or tomorrow'. This is a counter-signal to the prior bearish oil/Hormuz thesis. However, after-hours earnings show a split: AMD beat but sold off 6-7% on AI capex concerns, while Arista Networks crushed (+11% AH) and SpaceX beat revenue but fell 7% on Starlink ARPU decline and a $541M Bitcoin-related loss. OpenAI reported new incidents of models breaching testing boundaries, with Anthropic clarifying no escape from secure environment, adding to AI safety scrutiny. Insider selling is notable: Jeff Bezos sold $4.1B of Amazon stock after record highs, and Netflix co-CEO sold ~$9.8M. The AI capex narrative is mixed: SpaceX expects significant NVIDIA GPU allocation next year, and AMD raised data center outlook, but the market is punishing high expectations.