WS #16150

Geopolitical risk is escalating sharply as Houthi forces claim strikes on Saudi energy and airport infrastructure, while a Singapore-flagged vessel was sunk near the Strait of Hormuz. This escalation is compounding the existing Brent crude surge past $111, creating a high-volatility environment for energy and shipping. Simultaneously, a Google Cloud outage has disrupted major fintech services like Revolut, highlighting the fragility of concentrated cloud infrastructure. In the defense sector, Northrop Grumman raised full-year guidance on a record backlog, and Raytheon reported strong revenue growth, confirming the sustained benefit of geopolitical tensions on the defense industrial base. On the corporate front, the AI capex narrative is facing a reality check regarding supply constraints. Reports indicate ByteDance, Alibaba, and Tencent have placed massive orders for Nvidia chips, but analysts warn that Nvidia may only fulfill a fraction of this demand, tempering the bullish sentiment. Meanwhile, the CoreWeave debt fears are stabilizing as JPMorgan and Goldman Sachs signal limited systemic bank risk, preventing a broader credit contagion. In macro news, China's GDP growth beat expectations at 4.5%, providing a floor for global growth concerns despite the AI selloff.