WS #14401

The Middle East tensions continue to dominate the geopolitical landscape, with significant developments in the Red Sea and the Strait of Hormuz. The Houthis have seized control of key strategic locations, including Perim Island and the Bab el-Mandeb Strait, escalating regional instability. This has led to a surge in oil prices, pushing Brent crude above $108 per barrel, which is the highest level in four months. The IEA has warned of a potential oil supply gap by 2026, adding to the market's concerns about energy security. Inflation pressures are also mounting, with the US CPI report looming, and the Fed's potential rate hike in September adding to the uncertainty. The tech sector remains mixed, with some companies like Oracle seeing gains due to AI cloud backlog, while others face headwinds. Energy stocks are under pressure, and the market is closely watching for any signs of a resolution to the Middle East conflict.