WS #13968

The dominant theme remains the Strait of Hormuz closure, with the US and Iran exchanging opposing claims over control. Trump asserts 'total control' while Iran insists the strait remains closed until its demands are met, and an Iranian official denies any ceasefire extension talks. This is corroborated across multiple sources (Al Jazeera, GDELT, Scripps, Antiwar.com), reinforcing the escalation narrative. Oil prices are holding gains near $82-83 WTI, with the IEA cutting its 2026 supply forecast by 600k bpd, and the EIA seeing 600k bpd offline through end-2027. This supports bullish energy and bearish airline/shipping positions. The AI infrastructure trade continues to surge, with CoreWeave +19%, Super Micro +19%, Nebius +34%, and Lumentum +13.6%, driving the Nasdaq higher. Google Cloud revenue up 82% to ~$25B with backlog at $514B, and Cisco guiding FY27 AI infrastructure revenue at $7.5B. However, a counter-signal emerges: Mexico is pushing for lower auto tariffs in trade talks, which could ease trade tensions and benefit automakers. Additionally, China ordered Meta to unwind its ~$2B acquisition of AI startup Manus, a regulatory action that could pressure META. The CPI data (3.4% YoY) was in line, reducing Fed hike odds to ~40%, supporting gold near $4,400. Overall, the situation is stable with no de-escalation in Hormuz, but the AI rally and trade talks provide some offsetting positives.