WS #14016
The dominant Hormuz/oil narrative remains in a state of escalation, with Iran asserting control over the Strait of Hormuz and the US claiming a 'wall of steel' blockade, while actual oil flows are disputed. Oil prices fell ~2% on profit-taking and rising US inventories, but the underlying supply risk persists. The soft-inflation theme is reinforced by flat July PPI, supporting equities at record highs, with tech and memory stocks surging on AI demand. However, Cisco's 9% drop on margin concerns and Cerebras's 13% plunge highlight selective AI profit-taking. Anthropic's potential $2T IPO and Nvidia's $500B AI infrastructure financing plan underscore the AI capex supercycle, while Apple's Houston manufacturing investment and DeepSeek's price hikes validate AI pricing power. The US tariff evasion crackdown on 40+ countries, including India, adds a new trade-war dimension. The yen carry trade reversal and BOJ rate hikes pose a systemic risk, with gold near $4,400 and Treasury yields elevated.
Topics
Key developments
- Iran and US escalate Hormuz control dispute; oil prices fall 2% on profit-taking but supply risk persists
- DeepSeek raises prices 4.6-4.7x, validating AI pricing power and infrastructure supercycle
- Anthropic eyes $2T IPO in October, potentially largest ever, with Nvidia $500B AI infrastructure financing plan
- Cisco shares slide 9% despite earnings beat on margin concerns, while memory stocks surge on AI demand
- US accuses 40+ countries, including India, of tariff evasion via transshipment, plans AI-driven crackdown
- Apple invests hundreds of millions in Houston manufacturing, ships first advanced AI servers
- Yen carry trade reversal and BOJ rate hikes pose systemic risk, with gold near $4,400