WS #6770

The US-Iran conflict in the Strait of Hormuz remains the dominant market narrative, with new developments indicating escalation. Multiple sources (BBC, Al Jazeera, Bluesky) report that the US and Iran exchanged fire in the Strait, with oil prices jumping 1.5-7.5% intraday. However, President Trump stated the ceasefire remains intact and negotiations continue, acting as a counter-signal that dampens the bearish oil supply disruption thesis. Separately, Ukraine reportedly struck a Russian oil refinery, and drones attacked Moscow and Yaroslavl, adding to geopolitical risk. A US Federal Trade Court struck down Trump's backup tariff plan, a positive for importers and a negative for the administration's trade policy. Cathie Wood continued trimming AMD and buying Tempus AI, a signal for AI sector rotation. UK local elections show Labour losses and Reform UK gains, a political signal with potential policy implications. The narrative arc for the Hormuz situation is STABLE (ceasefire holding despite clashes), while the Ukraine-Russia conflict is ESCALATING.