WS #7405

The dominant macro narrative remains stagflationary: US 30-year Treasury yields hit 5.12% (highest since pre-2008), triggering a broad equity selloff led by tech/growth stocks. Oil prices continue surging (WTI +3.5%, Brent +3.1%) as the Strait of Hormuz closure drains inventories, with Capital Economics warning of critical levels by end-June and Brent at $130-140/bbl. The Trump-Xi summit ended with no breakthroughs on chips or Iran, disappointing markets and weighing on semiconductor names (NVDA, INTC). However, several counter-signals and MAG7 carve-outs emerge: Bill Ackman disclosed a new Microsoft position, calling it a 'highly compelling valuation,' and a $1.5M AAPL dark pool order ($451.85M) signals institutional rotation into Apple, contradicting the broader tech selloff. Iran's Foreign Minister stated all vessels except those from nations at war can transit the Strait, a slight de-escalation, but the UAE categorically rejected Iranian allegations and reserved military rights, keeping tensions high. The Fed terminated enforcement actions against UBS/Credit Suisse, a minor positive for financials. BofA warns CPI is nearing a market pain point, and incoming Fed Chair Warsh faces an early test as yields become 'unhinged.' Overall, the narrative is one of ESCALATING stagflationary pressure from oil and bonds, with selective tech strength in AAPL and MSFT as MAG7 carve-outs.