WS #13928

The dominant theme remains Middle East tensions, with the Strait of Hormuz crisis escalating. US forces opened fire on a Panama-flagged cargo ship attempting to break the blockade, and Trump reiterated 'total control' over the strait, while Iran refuses to discuss extending the ceasefire. Maritime traffic through Hormuz has collapsed to just eight vessels on Tuesday versus 130-140 pre-conflict, and an oil spill from a grounded tanker off Oman is expanding, threatening 40km of coastline. The IEA more than doubled its global oil deficit forecast to 1.8M bbl/day for Q3, and OPEC cut 2026 demand growth, supporting elevated oil prices. US July CPI came in at 3.4% YoY, core 2.5%, in line with expectations, reducing September rate hike odds to ~40%, providing a modest tailwind for equities. AI infrastructure demand remains robust, with Super Micro, CoreWeave, and Nebius beating earnings, lifting memory and AI-related stocks. However, a WSJ report warns that Nvidia's $500B chip-backed financing plan could create subprime-like risk, adding a cautionary note to the AI trade. Other notable developments include Wendy's surging on a potential take-private bid from Nelson Peltz's Trian, and the Lakers being sold to Bob Iger and Josh Kushner for $12.5B, which may have limited market impact.