WS #14862

Geopolitical tensions in the Middle East have escalated sharply, with Trump rejecting Iran's ceasefire proposals and US military escorts continuing to navigate the Strait of Hormuz. While France is working on a UN resolution to restore navigation, the physical flow of oil remains severely disrupted, with reports indicating very little oil is actually exiting the strait despite nominal openings. This has triggered a defensive posture in energy markets, with Indian refiners increasing LPG output to offset supply gaps, while broader equity markets remain surprisingly resilient, expanding despite the geopolitical risk. In the technology sector, a significant competitive shift is emerging as Meta's AI agent, Muse, rapidly gains market share, hitting 642,000 US users in just 12 days—outpacing ChatGPT's early adoption curve. This growth has added approximately $234 billion to Meta's market cap in five sessions, though it faces headwinds from Amazon blocking its integration into its shopping platform. Simultaneously, AMD is gaining traction against Nvidia due to performance advantages and pricing concerns, creating a mixed signal for the broader semiconductor narrative. Corporate developments include Apple facing a record $5.7 billion patent infringement judgment related to vibration technology, and Tesla achieving mass production of its Semi truck with a target of 50,000 units annually. In crypto, Bitcoin has recovered above $85,000 despite a $352 million hack on Bitget linked to North Korea, suggesting strong underlying demand. UK inflation has also fallen to its lowest level in over a year, providing a potential macro tailwind for rate-sensitive assets.