WS #15505

Global markets are pricing in a severe energy supply shock as Brent crude surges past $103/bbl, driven by escalating Middle East hostilities and the US deploying a third aircraft carrier to the region. The geopolitical backdrop is intensifying, with reports of over 80 US aircraft lost or damaged in the ongoing Iran conflict and new Israeli artillery strikes in Lebanon. This escalation is dragging down European equities and pushing bond yields higher, while simultaneously lifting energy stocks and pressuring airlines and consumer discretionary sectors. In the technology sector, a divergence is emerging between broad AI sentiment and specific supply chain realities. Samsung has reportedly passed Nvidia's quality tests for new memory chips, a positive signal for the AI hardware supply chain, while TSMC reported a massive 54.6% year-over-year revenue surge. However, this positive momentum is being partially offset by a sharp sell-off in Bitcoin, which has dropped below $83,000 as rising oil prices and bond yields trigger a risk-off environment across crypto and high-multiple growth assets.