WS #2089

The Strait of Hormuz crisis continues to dominate market-moving signals, with escalating military actions and supply chain disruptions. Goldman Sachs reports that average daily flows through the strait are down 97% from normal levels, corroborated by multiple sources including Bloomberg and Al Jazeera, indicating severe oil supply constraints. This is compounded by new attacks: Kuwait's Mina al-Ahmadi oil refinery was shut down after drone strikes, and the U.S. deployed A-10 attack aircraft against Iranian vessels in the strait, signaling heightened military engagement. Additionally, the French Navy boarded the oil tanker Deyna in the Mediterranean, flying a Mozambican flag and departing from Russia, suggesting expanding maritime enforcement amid the crisis. These developments reinforce bearish pressures on global energy markets, with specific impacts on oil prices and related sectors. Simultaneously, regulatory risks in the technology sector are intensifying. Super Micro Computer (SMCI) faces acute pressure, with shares falling 27% on DOJ charges over alleged illegal AI exports to China involving NVIDIA GPUs, tied to $2.5B+ in shipments. This has shifted concerns from technical to regulatory damage, affecting AI-related stocks like NVDA. In contrast, Milestone Pharmaceuticals reported a positive earnings beat with sales of $1.546M exceeding estimates, but this is isolated and unlikely to offset broader market volatility. The S&P 500 is on track for its fourth consecutive red week, its longest losing streak in over a year, reflecting overall market stress driven by these geopolitical and sector-specific headwinds.