WS #11805

The dominant theme remains the escalation of US-Iran hostilities, with the ceasefire declared over and both sides trading attacks over the Strait of Hormuz. Tanker traffic through the Strait has slowed dramatically (22 vessels vs 48 a week ago), and the IEA warns of the first annual decline in global oil demand since COVID-19 due to the disruption. Oil prices eased on Friday but remain on track for weekly gains of 4-5%. A counter-signal emerged: four US senators reached a deal with the Trump administration to move Russia sanctions legislation forward, which could dampen geopolitical risk premiums. Separately, the Fed's monetary policy report acknowledged high inflation due to tariffs, signaling rates may stay higher for longer. On the corporate front, SK Hynix's Nasdaq debut was a standout success, opening at $170 (14% above the $149 offer price) and raising $26.5B in the largest foreign IPO in US history. The stock continued to rise in early trading. Meta surged nearly 6% on a report that it will begin mass production of its own AI chip in September, aiming to reduce dependence on Nvidia. Apple's expanded deal with Broadcom (now expected to top $30B through 2031) was also highlighted. The US-Iran narrative is ESCALATING, while the semiconductor narrative is STABLE with bullish company-specific signals. A carry-forward from prior awareness: the Apple-Broadcom deal and Meta's AI chip production plans remain high-significance positives.