WS #13464

The dominant narrative remains the Strait of Hormuz reopening, which is ESCALATING with multiple new data points. Iran's Foreign Ministry confirmed a joint announcement with Oman is in its final stage, contingent on 'certain third parties' not interfering, and that geographic characteristics of the route have been agreed. Treasury Secretary Bessent said a deal could come as early as Wednesday, and Trump said it could come as early as Wednesday. However, Iran's spokesman also cautioned that the deal 'in itself' does not mean the Strait is secure, and prediction markets show only 2% odds of normal shipping by August 15, creating a gap between official optimism and market skepticism. Oil prices fell ~5% on the news, with WTI around $75 and Brent below $80, while gold rose to six-week highs on a weaker dollar and rate-hike expectations easing. US equity indices hit record highs, with S&P 500 above 7700, driven by strong earnings (Disney, Eli Lilly) and Hormuz optimism. In corporate news, SpaceX plunged 13% despite beating revenue estimates, as investors focused on $18.4B AI capex (six-fold increase) and a $1.26B AI segment loss; the stock is down over 50% from its post-listing peak. AMD slid ~8.5% despite a beat, as expectations were too high. Disney rose 3.2% on strong earnings and exploration of a free ad-supported streaming tier. Eli Lilly surged 7% on a massive Q2 beat (revenue $22.97B vs $20.69B est, Mounjaro +91%). ADP employment came in at 44K vs 65K est, a significant miss that could influence Fed expectations. EIA crude inventories rose 2.5M barrels vs expected draw, a bearish oil signal. Michael Burry warned Palantir and Nvidia are 'future ghost towns', adding to valuation concerns. The macro picture is one of record highs with underlying cracks in AI/semis and weak labor data.