WS #7398

Markets are under pressure from multiple fronts: the Trump-Xi summit ended without a chip deal or Strait of Hormuz resolution, inflation expectations are surging (CPI projected at 6% in Q2), and UK political turmoil is driving borrowing costs to financial-crash-era highs. The Strait of Hormuz closure continues to drain global oil inventories, with Capital Economics warning Brent could hit $130-140/bbl by end-June. US industrial production rose more than expected in April, but this is overshadowed by macro headwinds. NVDA is down ~3.6% premarket, TSLA down ~3.8%, while AAPL is flat. The dominant narrative is ESCALATING: the Iran/oil supply crisis, inflation, and political instability in the UK are all intensifying. A key counter-signal is the US Energy Secretary stating China will buy more US crude, which could partially offset the Strait of Hormuz disruption for US producers. Additionally, China's Foreign Minister Wang Yi agreed to reduce tariffs bilaterally and announced Xi will visit the US in the fall, providing a modest de-escalation in trade tensions.