WS #8289

The dominant narrative of Iran de-escalation remains stable, but new cross-currents have emerged. USTR Greer's comments at a CFR event signal ongoing trade tensions with Canada and Mexico, with tariffs on Mexican goods persisting as long as the trade deficit exists, and a Federal Register notice seeking comment on $30B of Chinese goods for potential tariff modifications. This suggests no near-term trade resolution, which is mildly negative for broad markets but could benefit domestic producers. Meanwhile, Piper Sandler released a note arguing the Strait of Hormuz will remain largely closed for months, pushing oil to new highs, contradicting the prevailing de-escalation narrative. This is a high-significance counter-signal that could reignite energy sector bullishness and airline/consumer bearishness. After-hours earnings were mixed: Zscaler beat Q3 estimates but issued disappointing Q4 guidance, sending ZS down ~18%; Modine Manufacturing beat and raised guidance; Semtech beat Q1 estimates; Digital Turbine beat and guided above. Lululemon is reportedly nearing a settlement with founder Chip Wilson to end a proxy fight, which is positive for LULU. A chemical explosion at a Nippon facility in Longview, WA, has caused casualties and missing persons, which could impact local operations but is unlikely to have broad market implications. The Quad countries announced $20B in critical mineral supply chains and maritime surveillance initiatives, which is a medium-term positive for critical minerals and defense. NASA announced 3 uncrewed moon missions this year, supporting space-related stocks. The overall narrative arc is STABLE for Iran de-escalation but with a notable counter-signal from Piper Sandler on oil, and trade tensions remain elevated.