Midterm years have been notoriously weak for the stock market. But year three of the Presidential cycle has been extremely strong…
Source: Bespoke
BREAKING: DESALINATION PLANT IN KUWAIT STRUCK BY IRAN INDIAN WORKER KILLED ‘SEVERE DAMAGE’ TO ‘SERVICE BUILDING’
Iran allegedly struck a water desalination facility in Kuwait, causing a death and damage. Because Gulf countries rely heavily on desalination (especially Kuwait, where it provides about 90% of drinking water), the attack is framed as targeting a critical and vulnerable resource. This shifts the conflict from oil/energy infrastructure to water infrastructure—something even more essential and harder to replace or buffer. Desalination is highly concentrated in a small number of plants, making it fragile. This represents a dangerous move into a “water war,” where disruptions could have severe humanitarian consequences.
Institutional investors are dumping US equities at a massive pace:
Investors sold -$9.3 billion in US equities last week, bringing the 6-week total to -$13.5 billion. This comes as sales of single stocks surged to -$8.3 billion, the 4th-largest since the Great Financial Crisis. Institutional investors led with -$11 billion in outflows. Meanwhile, retail investors remained sellers for a 2nd consecutive week. Hedge funds returned to buying at +$1.8 billion, but they have sold -$4.9 billion over the last 4 weeks. Professional investors are running to the exit. Source: Global Markets Investor
Iran has drafted legislation to create the "Hormuz Law" which is expected create a formal toll system for the Strait of Hormuz.
Preliminary details include: 1. Hormuz Law to introduce fees on navigation and pollution in the Strait of Hormuz 2. Draft legislation also includes creation of a "regional fund“ 3. The move is seen as an attempt to formalize long-term tolls on global shipping routes 4. The US has called these tolls on the Strait of Hormuz both "illegal" and "unacceptable" The Strait of Hormuz situation is becoming even more complicated. Source: The Kobeissi Letter
The recent net selling by hedge funds is the third largest over the last decade.
Talk about risk-off! When the dust settles there will be some great opportunities. Source: Markets & Mayhem @Mayhem4Markets
Balance of Power: 2026 Midterms - Polymarket
Democrat sweep = 50% odds Source: C.Barraud
One war, 7 global shortages
Source: ADAM @AdameMedia Katusa Research
All 7 members of the Magnificent Seven are down on the year
(-8% for Apple to -26% for Microsoft) and underperforming the average stock in the S&P 500 (which is down -1%) by a wide margin.Source: Charlie Bilello
