WS #6305

The dominant narrative remains the escalating US-Iran conflict, with the Strait of Hormuz blockade continuing to drive oil prices and inflation. The US PCE price index hit 3.5% in March, its highest in nearly three years, driven by energy costs. The ECB held rates at 2% but signaled a potential June hike due to Iran war impacts on European inflation (Eurostat April flash at 3%). Trump approved the Bridger Pipeline Expansion (Canada-US), a counter-signal to ease oil supply concerns, but no concrete de-escalation in the Gulf. Ukraine struck Russia's Tuapse oil refinery for the fourth time, adding to global energy supply disruption. On the corporate front, Apple reported a strong Q2 with $111.2B revenue and $2.01 EPS, announced a $100B buyback, and ended net cash neutral policy, sending stock up 3% after-hours. Meta's $145B capex plan and Zuckerberg's comments linking AI investment to job cuts weighed on sentiment. Alphabet surged 10% on strong cloud growth. The DHS shutdown ended with Trump signing a funding bill, removing a domestic political risk. UK terror threat raised to 'severe' after Golders Green stabbing. Overall, the macro picture is one of persistent inflation and geopolitical risk, but equity markets rallied (S&P 500 +1.02% to record) on strong tech earnings and the DHS resolution. The narrative is STABLE on Iran escalation, with a minor DE-ESCALATION signal from the pipeline approval and DHS funding.