WS #14980

The geopolitical crisis in the Middle East has escalated sharply following President Trump's rejection of an Iranian ceasefire proposal, driving oil prices past $107 and triggering a stagflationary shock across global markets. Brent crude is approaching $109 as the Strait of Hormuz remains a focal point of tension, with Iranian missile strikes on US Marines compounding the supply risk. This escalation is forcing a rapid rotation into energy and defensive assets, while simultaneously spiking 30-year Treasury yields to 5.535% on inflation fears and pushing the yield curve toward inversion, a classic recession signal. In the technology sector, the narrative is bifurcating. While the broader market suffers from breadth lows reminiscent of the Dot-Com bubble, Nvidia has announced a massive $150 billion increase to its share repurchase program, bringing the total buyback authorization to $235 billion. This aggressive capital return signals strong balance sheet confidence amidst the AI infrastructure build-out. Conversely, Micron is facing a post-earnings plunge, and Roblox was downgraded by Jefferies, highlighting that the tech rally is becoming increasingly selective and vulnerable to macro headwinds. Corporate developments are mixed but largely defensive. Merck secured exclusive global rights to the KRAS inhibitor SPR2015 for $400 million, bolstering its oncology pipeline. Meanwhile, Deloitte reported a slowdown in core consulting growth, and Deutsche Bank turned bearish on PepsiCo. The market is pricing in a 'stagflation combo' of rising oil, ripping yields, and falling stocks, with investors moving into gold and energy while avoiding growth and consumer discretionary names.