WS #7391

The dominant narrative remains the Iran/Hormuz situation, which is STABLE with no major escalation or de-escalation. However, several new data points have emerged in this window. The UAE plans to double its crude export capacity bypassing the Strait of Hormuz by next year, a counter-signal that dampens the bearish oil supply thesis. Separately, Bloomberg reports an Iran war oil shock predicted to trigger the biggest global demand hit since Covid, reinforcing the bearish macro outlook. On the economic front, U.S. Industrial Production for April came in at +0.7% M/M vs +0.2% consensus, a strong beat that adds to the inflation narrative and supports the bond selloff. Treasury yields hit their highest since May 2025 on oil surge and inflation fears. S&P 500 futures fell 1% amid a broad global bond selloff. On the MAG7 front, Alphabet (GOOGL) sold $3.6 billion in yen-denominated bonds, the largest-ever yen bond issuance by a foreign company, which could signal capital repatriation or hedging. A post on smartphone/memory cost inflation highlights rising component costs for AAPL and DELL. Starbucks (SBUX) is cutting 300 US corporate jobs and closing some regional offices, its third round of layoffs under CEO Brian Niccol. The CMA conditionally cleared the Getty merger with Shutterstock (SSTK). Applied Materials (AMAT) saw multiple analyst price target raises after strong Q2 results. Overall, the Iran situation remains the highest-signal item with oil and energy stocks likely to react, while the broader market faces inflation headwinds from surging bond yields and strong industrial production.