WS #13533

The dominant theme is the escalating US-Iran conflict and its impact on oil and shipping, with a potential counter-signal emerging from Iran-Oman talks on reopening the Strait of Hormuz. Iran claims it is in the 'final stage' of talks with Oman, but also demands the US address commitment violations, indicating uncertainty. Oil prices are rising (WTI +1.58%, Brent +2.00%) as Gulf shipping grinds to a halt following Houthi missile claims, and Ukrainian drone strikes on Russian refineries add to supply concerns. This is bullish for energy (XOM, CVX, OXY) and bearish for airlines (DAL, UAL) and shipping. The AI/storage complex shows a sharp divergence: SanDisk and Western Digital reported strong earnings but saw their stocks fall 10-19% on guidance concerns, while a detailed thread argues the selloff is a positioning-driven dislocation with strong underlying demand (SanDisk $93.9B contracted revenue, WDC negotiating supply to 2029-31). This suggests a potential buying opportunity in SNDK and WDC. Additionally, SpaceX's first earnings report showed a 13% stock drop on $18.4B capex (sixfold increase) for AI infrastructure, wiping out $87B of Musk's net worth, raising concerns about AI spending sustainability. Fed Governor Lisa Cook's hawkish comments (prepared to raise rates if inflation persists) are a key macro signal, potentially pressuring growth stocks. The UK approved Paramount's $81B takeover of Warner Bros. Discovery, removing a regulatory hurdle. Other notable earnings: Insmed surged 33% on raised guidance, AppLovin dropped 20%, Clover Health soared 20%, and AdaptHealth fell 26% on guidance cut.