WS #6260

The Iran conflict narrative continues to escalate, with Brent crude surging past $126/bbl, the highest since March 2022, as the US blockade of Iranian ports persists and Iran warns of 'unprecedented military action.' The UAE's exit from OPEC, effective May 1, adds a structural shift to the oil market, potentially weakening the cartel's influence but unlikely to ease near-term supply constraints due to the Strait of Hormuz blockade. The Fed held rates steady at 3.5-3.75% but with a deeply divided vote (8-4), the most split since 1992, and Powell's decision to remain as a governor after his chair term ends on May 15 introduces a counter-signal to expectations of a more dovish Fed under a Trump appointee. Asian currencies hit record lows as oil spikes, with the yen breaching 160 and the Indian rupee falling to 95.02. Samsung posted record quarterly profit (operating profit up 750% YoY) on AI memory demand, while Alphabet signaled 2026 CapEx of $180B-$190B with further increases in 2027, underscoring the AI infrastructure boom. Meta's Q1 revenue beat at $56.31B (+33% YoY) but its first-ever DAU decline (to 3.56B) and EU regulatory action on age verification pose headwinds. The US war in Iran has cost $25B so far, per the Pentagon, adding fiscal pressure. Trump suggested a 'similar timetable' for ending Iran and Ukraine conflicts after a call with Putin, who proposed a temporary ceasefire for May 9. The dominant narrative is ESCALATING, with oil supply disruption and geopolitical tensions intensifying, but the Fed's hawkish hold and Powell's continued presence act as a counter-signal to aggressive rate cut expectations.