WS #14350

The dominant signal is the renewed US-Iran military escalation, with US forces striking Iranian rocket launchers on Larak Island in the Strait of Hormuz—the first US military action in a month—and Iran retaliating with ballistic missile strikes on US bases in Jordan, with air alerts and traffic halts in Saudi Arabia and the UAE. This is corroborated by multiple sources (AP, BBC, Bloomberg, OSINT, GDELT, and Bluesky), driving Brent crude above $90 (up >2%) and WTI above $85, while S&P 500 futures edge lower. The escalation reverses the recent shift toward economic pressure, though Treasury Secretary Bessent's plan to sanction another bank this week signals a dual-track approach. The situation is ESCALATING, with Iran vowing retaliation and the risk of further disruption to Hormuz shipping, which carries ~20% of global oil. This is high significance for energy (bullish XOM, CVX, refiners) and bearish for airlines (DAL, UAL) and shipping (MATX, ZIM). Separately, a major macro development: the Justice Department has reportedly issued subpoenas to the Federal Reserve, threatening criminal indictment of Fed Chair Powell, which has spooked markets (Dow, S&P, Nasdaq futures down 0.5-0.8%) and raises the specter of Fed independence being compromised—a high-significance bearish signal for equities and bonds. Also notable: Bessent's comments on China's $1.2 trillion trade surplus and stronger trade barriers, which could escalate trade tensions. Nvidia's Friday reversal (down 4.6% to $217.55 after a 9% pop) is a MAG7 counter-signal to the tech rally narrative, with the CNBC piece linking it to Fed policy clues and drawing parallels to Intel's post-earnings unraveling.