WS #6775

The US-Iran conflict in the Strait of Hormuz continues to escalate, with multiple sources reporting an exchange of fire and a collapsed ceasefire. CNBC reports the emergence of the 'NACHO' trade (Not A Chance Hormuz Opens), signaling market skepticism that the crisis will resolve soon. This reinforces bullish energy and defense sectors while pressuring indices and consumer stocks. Separately, Toyota reported a 20% drop in annual profit forecast due to Middle East tensions, confirming the negative impact on global supply chains. UK local elections show major losses for Labour, with Reform UK making significant gains, adding political uncertainty. Forward Air stock plunged 45% after hours on earnings and potential loss of major customer. Russia launched over 850 drone strikes against Ukraine, escalating the conflict. The dominant theme is ESCALATING geopolitical risk in the Middle East, with oil prices likely to remain elevated.