Oil Tops $100 as Iran Holds Hormuz; Yields Spike, Stocks Drop
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- Oil prices climbed above $100/barrel — Brent +5%, WTI +3% — as Iran kept its grip on the Strait of Hormuz and most shipping through the chokepoint remained at a standstill despite the latest U.S. pledge to help free stranded vessels.
- U.S. Treasury yields spiked roughly 6 basis points across the curve, with the 30-year above 5% (its highest since July) and the 2-year and 10-year at their highest levels since late March, as the energy shock fanned inflation fears.
- Wall Street slid, with the Dow down 1% and all 11 S&P 500 sectors finishing red except energy (+0.9%); Asia ex-Japan jumped 2.8% on KOSPI's 5% surge to record highs, while Europe fell 1%.
- Jamie McGeever's column warns U.S. inflation is heading to 4% — well above the Fed's 2% target — arguing the energy shock will keep pushing consumer prices higher in coming months.
- Morgan Stanley raised its hyperscaler AI capex forecast to more than $800 billion this year and $1.1 trillion next year, while Goldman Sachs projects cumulative AI infrastructure spend of $7.6 trillion by 2031; Q1 earnings are on track to rise 27.8% year-over-year.
- GameStop proposed a $56 billion cash-and-stock bid for eBay — a target nearly four times its size — sending GameStop shares down 8.5% and eBay up 5% as investors questioned the funding.
Why it matters: With oil above $100 and most Hormuz shipping stalled, the energy shock is now bleeding into U.S. inflation expectations — McGeever argues 4% is coming — which is why 30-year yields cleared 5% and the Dow lost 1% in a single session. Consumers and rate-setters are on a collision course: the Fed's 2% target recedes further as fuel costs compound, while the looming Q1 earnings season (tracking +27.8% growth) offers the only real counterweight to the bearish bond-and-stock repricing.
