WS #14741

The geopolitical risk premium has escalated sharply as the US Senate blocked a War Powers Resolution to halt military action against Iran, while new US sanctions effectively halted commercial flights to Iran. Concurrently, Brent crude surged past $107/barrel driven by fears of a Strait of Hormuz closure, despite reports of a phased deal to reopen it. France has deployed military assets to protect Saudi Arabia's Yanbu port, signaling a direct Western military commitment to Gulf energy infrastructure. This escalation is compounded by renewed full-scale conflict in Ethiopia's Tigray region and Ukrainian drone strikes on Russian oil depots, creating a multi-front supply shock environment. In the domestic macro sphere, the 10-Year Treasury yield hit 5.17%, the highest since 2007, reflecting persistent inflation pressures as companies continue to pass on costs. The market is pricing in a 'higher for longer' regime, with bond yields crushing growth multiples. On the corporate front, Leslie's is preparing a Chapter 11 filing, and Starbucks is closing 250 stores, highlighting consumer weakness and margin compression in the face of sticky inflation. Meanwhile, India's Akasa Air is in talks to order 200 Boeing 737 MAX aircraft, providing a bright spot for the aerospace supply chain.