WS #14368

The Middle East tensions continue to escalate, with recent reports of Iranian strikes on U.S. warplanes in Jordan and the capture of strategic Red Sea ports by Yemen's Houthis. These developments have intensified geopolitical risks, contributing to a surge in oil prices surpassing $100 per barrel. The Fed's rate hike expectations remain a dominant market narrative, with the 10-year Treasury yield persisting above 5%. The tech sector's positive reaction to Meta's AI assistant, Muse, continues. TSMC's record revenue surge of over 53% has bolstered investor confidence in the semiconductor industry, while the market remains sensitive to any new geopolitical developments or changes in Fed policy. Recent developments include OPEC's decision to cut its 2026 global oil-demand growth forecast to 380,000 barrels per day and raise its 2027 forecast to 2.36 million barrels per day. Additionally, the capture of strategic Red Sea ports by Yemen's Houthis has raised concerns about the potential closure of the Bab el-Mandeb Strait, which could further impact global oil trade. The market is also closely watching the outcome of the upcoming U.S. elections, as they could influence future economic policies and interest rates.