WS #9104

The dominant narrative from the prior window—tech selloff driven by a hot jobs report and rising rate expectations—is confirmed and escalating. The May jobs report significantly beat forecasts, leading bond traders to fully price in a Fed rate hike by year-end. This triggered a massive rotation out of growth/tech, with the chip sector suffering its worst day in 6 years. QQQ fell 5.33%, SPY dropped 1.16%, and the selloff was broad-based across semis (Marvell, Micron, Intel, Qualcomm). The VIX spiked to 21.5, indicating elevated risk. A counter-signal emerged: Alphabet (GOOGL) showed notable relative strength, with a $19.25B mandatory convertible preferred stock raise and an upcoming SPCX IPO, suggesting institutional demand for high-quality tech names despite the macro headwinds. Geopolitically, a Ukrainian naval drone exploded near an oil terminal in Constanta, Romania, and a drone strike hit Oman's Mina al-Fahal oil terminal, halting cargo operations—both events that could disrupt energy supply and support oil prices. Trump stated Iran talks are 'going well,' but the drone attacks suggest ongoing instability. The prevailing macro theme is tech selloff (ESCALATING), with the chip rout deepening. The GOOGL strength is a notable MAG7 carve-out contradicting the macro narrative.