Wall Street Morning Report: US-Iran tensions escalate, crude oil surges 5%, tech stocks face selling pressure, dollar and US Treasury yields strengthen simultaneously.

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Overnight US stocks closed broadly lower, with the market re-entering a "risk-off and repricing" mode. The Dow Jones fell 0.25%, the S&P 500 fell 0.45%, and the Nasdaq fell 1.16%, with tech stocks being the main source of selling pressure, while energy, defensive, and value sectors saw inflows against the trend. Market sentiment quickly shifted from the previous AI growth narrative to the dual themes of "geopolitics + inflation risk."

Middle East situation escalates suddenly, crude oil surges 5%

Less than 20 days after the ceasefire agreement was signed, US-Iran relations have deteriorated again. The US announced the revocation of Iran's oil sales waivers and launched a new round of airstrikes on multiple military targets in Iran. According to US officials, the scale of the strikes has expanded four to five times compared to the previous round, emphasizing that this action is a direct response to the attack on merchant ships in the Strait of Hormuz.

As the US re-restricts Iran's oil exports, the market quickly repriced global energy supply risks. WTI crude oil rose nearly 6% during the session, closing up 5% above $72; Brent crude also closed up over 5%, approaching $76. Bob McNally, President of Rapidan Energy Group, stated that this move means the market's previous optimistic expectations for the stability of the ceasefire agreement have been shattered, and the energy market needs to reprice a higher geopolitical risk premium.

The Strait of Hormuz, as one of the world's most important energy transportation chokepoints, has once again become the focus of global traders. US Central Command stated that military operations will continue, and multiple former US officials, including David Schenker and Michael Singh, believe that the prospects for a final US-Iran agreement have significantly worsened. Whether the US will expand sanctions further in the coming days will be a key variable determining the direction of oil prices.

Dollar and US Treasury yields strengthen simultaneously, market focuses on Fed minutes

The surge in crude oil prompted the market to repricing global inflation risks, but the simultaneous strengthening of the dollar weighed on precious metals. Spot gold briefly fell below $4,100 per ounce, dropping over 1% intraday; spot silver fell nearly 4%, becoming one of the weakest-performing commodities.

Traders believe that this round of gold pullback is not due to the disappearance of safe-haven demand, but rather the rise in oil prices pushing up US Treasury yields and the dollar index, causing real interest rates to rise and suppressing precious metals. Funds currently prefer to allocate directly to energy assets rather than traditional safe-haven metals.

The dollar index rose to around 101, and US Treasury yields rose across the board. The 10-year US Treasury yield surged 1.87% to around 4.54%, and the 30-year yield broke above 5% again, hitting a new high in over a month.

In addition to energy prices pushing up inflation expectations, large-scale bond financing also added to yield pressure. Amazon plans to issue at least $25 billion in bonds for AI infrastructure construction, coupled with ongoing US Treasury issuance, jointly driving long-term interest rates higher.

New York Fed President John Williams stated that the previous decline in energy prices had eased his concerns about inflation, but as the Middle East situation deteriorates again, the market has begun to reassess the future path of rate cuts.

The biggest macro focus for the market today will shift to the Fed's latest meeting minutes released early on July 9, which is the first meeting record chaired by Warsh. Traders will closely watch the committee members' discussions on inflation persistence, energy price shocks, and the future interest rate path, hoping to find new clues for the policy direction this year.

AI sector cools, US-listed Chinese stocks surge in overnight trading

The AI theme is experiencing a phase of cooling, with significant profit-taking in tech growth stocks. Funds are rotating from high-valuation AI infrastructure to energy, defensive, utilities, and traditional value sectors, further widening structural divergence within the market.

Although the Nasdaq posted the largest decline among the three major indices, the majority of S&P 500 components actually recorded gains, indicating that the index decline was more driven by a pullback in large-cap tech weights rather than a complete collapse in overall market risk appetite. Morgan Stanley strategist Mike Wilson believes that the momentum of chip stocks is weakening, and funds are reallocating to previously lagging sectors. This internal rotation is actually conducive to the continuation of the bull market. US stock overnight data shows that the Chinese ADR sector rose sharply, with Alibaba up 7.5%, Baidu up 5.2%, NetEase and JD.com both up over 3%. Additionally, the memory and semiconductor sectors also rebounded slightly.

Specific project movements and stock price fluctuations:

AI and chip sector: The Philadelphia Semiconductor Index plunged 4.65%, becoming the worst-performing sector of the day. Intel fell nearly 10%, AMD fell over 6%, Marvell fell over 7%, Micron fell nearly 5%, TSMC ADR fell over 4%, and storage stocks like Western Digital, SanDisk, and Seagate generally fell over 5%. This round of adjustment mainly stems from the market reassessing the pace of AI infrastructure capital expenditures. Samsung's record profit failed to exceed the market's extremely high expectations, triggering a "buy the rumor, sell the fact" trade. The selling pressure in Japan and South Korean semiconductors eventually transmitted to the US stock market. UBS traders stated that the core logic of the day was a concentrated unwinding of momentum positions around the AI and chip sectors, rather than a fundamental deterioration.

Nvidia rose 0.71% against the trend, becoming one of the few large chip stocks to gain. Although the market had previously worried about delays in the next-generation Kyber server, massive inflows of call options indicate that institutional funds are still firmly betting on AI computing power demand. Market data shows that Nvidia call option volume exceeded 1.5 million contracts, more than double the put option volume, indicating that funds still view it as a core asset in the AI ecosystem.

Meta rose 2.55%, leading the "Magnificent Seven" tech stocks. The company officially launched a new generation of AI image generation model Muse Image, fully integrated into Instagram, WhatsApp, and the Meta AI platform. It will also open AI marketing tools to advertisers in the future, accelerating AI commercialization.

Microsoft rose 0.54%. The market is paying attention to its replacement of some models from OpenAI and Anthropic with its self-developed MAI model in products like Excel and Outlook, indicating that AI competition is gradually shifting from model capability to inference cost and commercial efficiency.

Amazon rose 0.75%. The company plans to issue at least $25 billion in bonds to finance AI data centers, capital expenditures, and potential M&A, showing that global cloud giants continue to increase AI capital investment.

SpaceX fell 6.83%, hitting a new low since its listing. Although the company was officially included in the Nasdaq 100 index and received initial bullish coverage from multiple institutions like Morgan Stanley and Goldman Sachs, the market is concerned about legal challenges to its AI data center project and execution risks for a $45 billion computing power contract. The positive catalyst from index inclusion was realized in the short term.

Tesla fell 4.02%, but market expectations for its future integration with SpaceX continue to heat up. William Blair, RBC, and JPMorgan all believe that the likelihood of some form of strategic integration between the two companies within the next year or two has significantly increased. If a deal is eventually completed, Tesla's valuation could have 20% to 30% upside potential, but regulatory and governance structures remain the biggest obstacles.

Rocket Lab fell 10.4%. The company announced after the close that it successfully completed the US Space Force's VICTUS HAZE mission, further strengthening its competitive advantages in defense and commercial aerospace. It rose 2.37% in US stock overnight trading.

Rivian fell over 18.00%: As a strong emerging force in the EV space, Rivian faced a ruthless sell-off after announcing its latest stock offering plan and releasing its earnings report, with the stock price falling over 18%, marking its worst single-day performance of the year. This once again confirms the extreme market fear of cash flow dilution in capital-intensive industries.

Crypto concept stocks fell broadly, with Circle down about 5%, Robinhood down nearly 4%, Coinbase down 3.17%, Strategy down 3.38%, and MARA down 6.95%.

Next to watch:

July 9, 02:00: The Fed releases the latest FOMC meeting minutes. The market will focus on committee members' discussions on inflation, energy prices, and the future path of rate cuts, which could directly impact the dollar, US Treasuries, and tech growth stocks.

July 8-9: The Paris Raise Summit AI conference convenes. Tech and financial giants including Google, AMD, Broadcom, OpenAI, Anthropic, and Goldman Sachs will discuss AI infrastructure, model commercialization, and enterprise applications. Related speeches may affect AI sector sentiment.

July 9: The funeral of Iran's late Supreme Leader Khamenei will be held. The market will closely watch whether the US and Iran resume negotiations and whether the US announces further sanctions. The situation in the Strait of Hormuz will continue to dominate crude oil and global risk asset volatility.