WS #14673

Global equity markets are under severe pressure as US 10-Year Treasury yields hit a 19-year high, triggering a broad-based selloff across the Nasdaq, European indices, and Asian markets (Sensex down 600+ points). This macro shock is compounded by escalating geopolitical tensions in the Middle East, where Brent crude has surged past $100/barrel following reports of Iranian blockade activity and Israeli strikes in Lebanon. The combination of rising borrowing costs and supply-side energy inflation is compressing valuations and threatening demand destruction. Amidst this volatility, specific sectoral narratives are diverging. The technology sector faces a headwind from the yield spike, yet AI infrastructure spending remains robust, evidenced by Supermicro shipping NVIDIA Vera Rubin racks and Microsoft’s $10bn Middle East cloud commitment. Conversely, consumer discretionary and retail are weakening, with H&M warning of freight cost impacts and Stitch Fix slumping on weak guidance. The geopolitical situation is escalating, with the US considering a diesel export ban and Iran-US talks at the UN failing to de-escalate immediate hostilities.