WS #15270

The geopolitical situation in the Middle East has escalated sharply, with the Saudi-led coalition intercepting and destroying three ballistic missiles fired by Houthis toward Khamis Mushait. This marks a significant intensification of kinetic activity in the Red Sea, compounding the ongoing threat to shipping lanes with another tanker struck in the Strait of Hormuz. While the G7's agreement to release 100 million barrels of reserves acts as a critical dampener on the oil price spike thesis, the persistent physical threats to energy infrastructure and shipping routes sustain a high-risk premium for the energy and logistics sectors. In the technology sector, Nvidia has surged to a new all-time high, pushing its market capitalization near $6 trillion, driven by robust demand for AI infrastructure and new data center contracts. Conversely, the broader AI narrative faces headwinds as Ethereum Layer-2 Blast shuts down due to unsustainable economics, and Google's Pixel 10a price hike signals input-cost pressures. Meanwhile, the US labor market showed unexpected weakness with only 29k jobs added, which has initially calmed bond market rattling and supported equities, though the underlying recession fears remain a persistent macro overhang.