WS #7145

The dominant macro narrative remains the Middle East escalation and oil supply disruption, which continues to ESCALATE. Oil prices surged again, with WTI crude closing above $102 and Brent above $107, driven by ongoing Strait of Hormuz tensions. The UK announced deployment of a warship and fighter jets to the Strait of Hormuz for a multinational security mission, with £115 million in new funding to protect shipping lanes. This escalation reinforces the bullish oil thesis and bearish risk-on sentiment. The S&P 500 and Nasdaq fell as oil jumped, with tech stocks under pressure. Meanwhile, the US Senate confirmed Kevin Warsh to a 14-year term as a Federal Reserve governor, with his concurrent term as Fed chair also being processed, signaling potential hawkish lean. UK long-term bond yields hit 1998 highs as the pound slumped amid political uncertainty around PM Starmer. On the corporate side, Bel Fuse announced a 1.3M share offering, Bitcoin Depot expressed substantial doubt about going concern, and Nextpower beat Q4 estimates and raised FY27 guidance. Meta temporarily gave rival AI chatbots WhatsApp access during EU antitrust talks, a potential regulatory concession. In this window, Anthropic is reportedly in talks to raise $30B at a $900B valuation, a massive AI funding round that signals continued investor appetite for AI infrastructure. JPMorgan filed to launch a tokenized money-market fund on Ethereum, following BlackRock's similar move, accelerating the Wall Street tokenization trend. MSCI announced its May 2026 index review, with 49 additions and 101 deletions from the ACWI index, effective May 29, which will drive passive fund flows. The US Air Force T-38 Talon II jet crashed in Mississippi, but both pilots ejected safely, a minor event. A 4.5 magnitude earthquake struck near Tehran, Iran, adding to geopolitical jitters but unlikely to have major market impact. Clothes saw the biggest price jump in three years, attributed to Iran war effects on supply chains. Trump's approval is reportedly crashing amid inflation spikes, and UK bond yields hit 1998 highs as Starmer's political future is questioned. These macro headwinds are escalating, with oil and inflation driving bearish sentiment on risk assets.