WS #13672

The dominant theme remains the Strait of Hormuz crisis, which is now showing signs of both escalation and potential de-escalation. Iran's foreign minister says a deal with Oman is 'very close' but conditions it on US compensation, while the IRGC hardens its stance, stating the strait stays closed until US accepts Tehran's conditions. Simultaneously, a US official expects a deal soon and would lift the blockade. However, the UAE reports an Iranian missile strike on an ADNOC tanker, and Gulf states (Saudi, Qatar, GCC) strongly condemn it, indicating continued military risk. This mixed signal suggests oil prices remain volatile, with potential for sharp moves on any headline. Separately, US jobs data (July nonfarm payrolls -23,000) is fueling expectations the Fed will hold rates in September, supporting equities. The AI trade is rebounding after the Situational Awareness fund collapse, with Palantir and storage names (SanDisk, Western Digital) beating but guiding cautiously. Berkshire Hathaway's Q2 report is due Saturday, with buyback expectations. Ukraine strikes on Russian oil refineries continue, adding to supply concerns. Overall, the market is balancing geopolitical risk with a dovish Fed and AI recovery.