WS #14001

The market narrative remains risk-on, driven by cooling US inflation (PPI flat m/m, below expectations) and a sharp drop in oil prices (WTI -2.6%, Brent -2.2%) as OPEC and IEA slash 2026 demand outlooks. This has pushed the S&P 500 to a record intraday high, with the Nasdaq up ~0.9%. Bond traders have increased September Fed pause odds to 65.6%, and October pause odds to 51.1%, after PPI and jobless claims data. However, geopolitical risk is escalating: Houthis claim a drone strike on an Aramco refinery in Jizan (third strike in three weeks), diesel cracks surge past $98/barrel (all-time high), and Russia threatens to seize European merchant ships. These supply-side shocks are partially offset by demand weakness, keeping oil prices lower. In tech, Cisco falls ~8% despite beating estimates, while Meta rises ~2% on AI infrastructure push. AMD announces a $5B debt offering. SanDisk surges 12% on AI storage roadmap. IREN jumps on Microsoft AI cloud deployment. Tencent to become top shareholder of Manus, unwinding Meta's deal. US sends fresh aircraft carrier to Middle East amid Iran war strain. UK GDP grows 0.4% Q2. US July budget deficit hits record -$432B.