WS #12285

The dominant narrative is a broad tech selloff, particularly in semiconductors, with the VanEck Semiconductor ETF briefly entering bear market territory. This is driven by renewed concerns over AI spending, a rotation out of tech, and a weak Q3 forecast from Netflix (NFLX) which fell ~10% after hours. The US-Iran conflict continues to escalate, with oil prices surging (WTI +2.74%) as the US conducted a sixth straight night of strikes and Iran reported a tanker hit at Kharg Island. This geopolitical tension is weighing on risk assets and pushing airline stocks lower. However, a potential counter-signal emerged: Chevron is reportedly signing a deal with Iraq to invest in oil fields and studying a pipeline bypassing the Strait of Hormuz, which could alleviate some supply disruption fears. Additionally, Apple (AAPL) briefly overtook Nvidia (NVDA) as the world's most valuable company, supported by an HSBC upgrade, highlighting a divergence within the Mag7. A 7.3-magnitude earthquake near Chiapas, Mexico triggered a tsunami warning, but initial forecasts suggest waves less than 0.3 meters, limiting immediate market impact. The tech selloff is escalating, while the US-Iran conflict remains at high intensity with a potential de-escalation signal emerging via the Chevron pipeline news. Key developments include: IBM plunging 25% after CEO admitted falling behind in AI spending shift; Intuitive Surgical dropping 11% on soft guidance; Netflix falling 10% on weak Q3 outlook; and the US sending more refueling planes to Israel ahead of possible escalation. The Chevron-Iraq pipeline deal is a critical counter-signal to the oil supply disruption thesis. Apple's overtaking of Nvidia in market cap underscores a rotation within tech. The semiconductor selloff is now in bear market territory, with the Philadelphia Semiconductor Index down 20% from highs.