WS #5809

The data window shows escalating geopolitical tensions in the Middle East, with the US-Iran standoff over the Strait of Hormuz intensifying. Trump has ordered the military to 'shoot and kill' Iranian boats in the Strait, and the US has extended its naval blockade indefinitely. This has driven oil prices higher, with Brent crude above $105/barrel and WTI at $94.35. The crisis is causing significant disruptions: Asian refining throughput is set to tumble as crude imports hit a 10-year low, putting diesel and jet fuel supplies at risk. New Zealand businesses are cutting staff and investments due to the conflict. However, there are counter-signals: Morgan Stanley has turned bullish on European equities, citing potential de-escalation in the Middle East, and the Israel-Lebanon ceasefire has been extended by three weeks. Separately, the software sector experienced a sharp selloff after ServiceNow and IBM reported mixed results, with ServiceNow falling 16% and IBM dropping 8%. Intel surged nearly 20% after hours on strong earnings. Meta's planned layoffs of 8,000 employees (10% of workforce) on May 20 are confirmed, which could weigh on META stock. The gold price has fallen sharply, with experts attributing it to a liquidity shock rather than a loss of safe-haven status.